The 'Old Vic' cinema is one of the most popular movie theatres in the city. 150 years old, the venue is popular with locals but capacity at the venue is limited, allowing just 150 people to attend each screening. The owner currently charges either $10 or $15 per per screening and there are two screenings per day. Demand for tickets is as follows:
(f) Following concerns over the number of emergency exits, the venue is forced to reduce capacity to 120 seats. Illustrate the effect of this on the market for cinema tickets and explain the likely impact on prices. [4]
(g) Following the trend of more consumers watching films in the comfort of their own home, the government is concerned about the economic viability of cinema venues. Using the data provided and your knowledge of economics, recommend a policy which could be introduced by the government to support the industry. [10]
