Sample Written Questions
How accurate is
this statement? "If the Anaheim Mighty Ducks acquire a star player, the
demand for their tickets will rise. This will cause the price of their tickets
to rise, causing demand to fall, restoring the initial price and quantity of
True or False: Graph and explain your answer. Maximizing revenue is the same thing as maximizing profits.
Assume that the market for footballs is perfectly competitive. Graph and explain the impact of a new cheaper leather substitute. In your answer be sure to explain which curve shifts and in what direction, what the changes in price and quantity will be. Explain the equilibrium process in this example.
The Florida Marlins
of MLB recently shed most of their best players. In 2006, their payroll was
less than one-tenth that of the New York Yankees. Would a team in England's
Premier League follow such a policy? Why or why not?
Provide a mathematical
model that explains why firms are unlikely to invest in general training. In
you answer explain the difference between general and specific training and
why this model only applies to one of these kinds of training.
What is the general
lesson of the prisoner's dilemma?
Use supply and demand curves to predict the consequences on the price of tickets of hiring a big name star. Be certain to carefully explain why you have chosen to shift, or not shift the curves.
How would a decrease in demand for cars affect the marginal revenue product of auto workers?
If sports teams are profit maximizing, and there are no labour market restrictions, why would large market teams win more games than small market teams? Is this inevitable? Be very specific about why teams invest in playing talent to win games. Graph and explain.
Cleveland voted to fund its new sports facilities through a tax on gambling. Let's say that this was done through a tax on firms that sold lottery tickets. Who would bear the burden of this tax?
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