Question 1)) Suppose a franchises supply curves for white and non-white players

Question

Question 1)) Suppose a franchises supply curves for white and non-white players are both perfectly elastic and that the two types of player are perfectly substitutable in the production process (for games or matches or whatever the output unit happens to be). The market wage for the white players is $150/player, while the market wage for non-white players are $100/player. Which of the following is (are) true?

a. The non-discriminating franchise will hire only non-white players

b. The discriminating franchise will hire only white players if its coefficient of discrimination (di) is greater than 0.5

c. Both (a) and (b) are true

d. Neither (a) nor (b) is true

VI).

VI.) Consider Wins Produced (WP) in the NBA, Wins Above Replacement and the sabermetrics revolution in MLB, Passer Ratings in the NFL. Each statistic is an attempt to estimate better the ___________ .

a. MPL of the player in the respective sport.

b. Strength of the player’s substitution effect response to an increase in salary (wages).

c. Strength of the player’s union during contract negotiations.

d. Strength of the reserve clause in the player’s respective sport.

VII). In the wake of the death of the reserve clause in MLB, then head of the MLBPA Marvin Miller convinced the players to put limitations on the number free agents each year. This action was an example of the union’s flexing its ___________ power and resulted in a ___________ in MLB relative to the other major professional sports in the U.S. over the past three decades.

a. Monopsony ; greater % increase in salaries

b. Monopoly ; greater % increase in salaries

c. Monopsony ; leveling off of salaries

d. Monopoly ; leveling off of salaries

VIII). The typical Buffalo Bills fan has a demand curve for tickets to home games that be expressed by

the following inverse demand curve:

P = 120 – 10Q                                   P:   $ / ticket

Q: tickets

The Bills can maximize the revenue received from the typical fan by charging a price of _________ for each of

the eight (8) home games played each year and charging ________ for the seat license to enable

the typical fan to buy single game tickets.

a. $40 ; $640

b. $80 ; $640

c. $40 ; $320

d. $110 ; $880

9). Revenue sharing between unions (players) and management (owners) should _______ the principal

agent problem because it would make incentives of the players and owners ________ aligned.

Ease ; more

Exacerbate ; more

Ease ; less

Exacerbate ; less

a. MPL of the player in the respective sport.

Explanation / Answer

Answer 5) option c

Non discriminating employer will higher those who have low wages only, non white

Now for discriminating, effective wages= wage(1+d)

d = discrimination coefficient

So with d=.5, effective wages = 150 so if d>.5 so effective wages for nonwhite rises above 150 so hire only white

Question 6) option a , all these statistics help in assessing the value of player through their MP

Question 7) complete question is not provided , some part is hidden or cut in screenshot provided

Question 8, cant be answered full question not provided

Q9)

Option a

Revenue sharing solves asymmetric information problem by aligning the interests of both parties

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