Question

8. For any given price, how would the following changes impact a team’s revenue?

a. Increase in the size of the market

b. Building a new stadium

c. Decline in the quality of the team’s roster

9. For a typical firm, what is the shape of the marginal cost curve? Why does it have this shape?

10. For a sports team, what might the shape of the marginal cost curve be? Why does it have this shape?

11. What is the profit-maximizing rule

12. According to deductive reasoning, how successful should the New York Mets be on the field relative to the Detroit Tigers? From 1962 to 2016, the Mets won 48.1% of their regular season games while the Tigers won 49.9% of their contests. Do these records match your deductive reasoning? Why or why not?

13. Why do NFL, NBA, and NHL teams tend to sell out while MLB teams do not

14. If P = $150 − 0.005 × Q, what is the equation for total revenue?

Answer 1

8)

a) Increase in the size of the market will increase the total revenue for the team as more people will come to watch the team and there can be an increase in ticket sales.

b) Building a new stadium can increase the total revenue as now more people can come to see the team and more stadium will mean more revenue in terms of ticket sales.

c)A decline in the quality of the team’s roster may decrease the total revenue as people may not come to see them when there is a decline in the quality of the team’s roster.