1. Write the decision to vote equation. Explain each variable. Use hypothetical numbers to illustrate the circumstances in which a person does and does not vote. Why is rational abstention an important concept when thinking about voting?
2. What is rational ignorance? How can it affect voting?
3. What is the difference between gross and net economic benefit? Why is this distinction at all important to the issue of public financing of professional sports facilities? What is the multiplier effect? What is the substitution effect? Why are both concepts relevant to understanding professional sports?
4. Given a cash flow (CF), number of time periods (T), and the interest/discount rate (r), calculate the present value of a stream of future payments. Adjust this estimate by the substitution effect, the multiplier, and any relevant opportunity costs.
a. .
5. Suppose that prior to the construction of the baseball facility for the Salem-Keizer Volcanoes an average 200 new jobs were created in the Salem-Keizer region each year. After the facility was built, the average number of new jobs created each year rose to 350. Should we conclude that the number of new jobs rose as a result of the facility being built? Why or why not?
6. Suppose Portland is awarded a MLB franchise. The owner of the team asks the city to subsidize $200 million of the costs to build a stadium. An independent consultant prepares an economic impact report for the city. The report suggests that the net benefits will barely exceed the cost of building the facility. However, the team owner argues that the report does not include an estimate of "intangible" benefits. The team hires YOU to prepare a list of these benefits and their value (in $). List three (3) examples of MEASURABLE intangibles.
7. Why do newspapers often support subsidies for professional sport facilities?
8. For each of the CBA presentations (aside from your own) during week ten, describe the three most interesting ideas you learned about from each presentation.