Assignment:
Instructions:
Insert your typed answers immediately following the corresponding question. Handwritten graphical responses are permitted; however, they too should be inserted immediately following the corresponding question (leave space so you can hand-write you graphs).
1.) True or False, and explain. If all teams in a league are of equal quality, it does not matter whether or not they share gate revenues, as revenues will be equal anyhow. (A graph or two of representative teams may be helpful.)
2.) The correlation between operating income rank and season win percentage rank in 2014 for MLB franchises was 0.0002. This suggests that there is no relation between team performance (quality) and profitability. Based on the theories discussed in class, is this lack of a relationship expected? Explain.
3.) Suppose you are the commissioner of the National Hockey League. You have been called to testify at an antitrust case against the NHL. Argue that:
a. The NHL is not a monopoly.
b. Even if it is a monopoly, it is a natural monopoly.