THE ECONOMICS OF SPORTS
COMPREHENSIVE EXAM SCRIPT VERIFIED
QUESTIONS AND SOLUTIONS GRADED
APLUS
●● Which of the following is a positive externality caused by subsidies
for the Columbus Crew?
a) Restaurants in the arena district will increase hiring
(b) Fans purchasing tickets will enjoy the game more.
(c) Traffic in the arena district will be terrible.
(d) All of the above
Answer: a) Restaurants in the arena district will increase hiring
●● Which is true of franchises that have recently built new stadiums?
a) Typically the team gets worse.
(b) Typically the team will be better and stay better for a long (> 10
years) period of time.
(c) Typically team performance in unaffected by new stadiums.
(d) Typically the team performs better for a short (< 10 years) period of
time.
Answer: (d) Typically the team performs better for a short (< 10 years)
period of time.
,●● How have fans benefited from new stadium construction in the last
20-30 years?
(a) Single sport stadiums have become more prevalent, providing better
viewing.
(b) Newer construction techniques have eliminated many of the
obstructed view seats.
(c) Newer stadiums are more aesthetically pleasing.
(d) All of the above
Answer: (d) All of the above
●● In the two team fixed talent model which area describes payroll for
the large market team?
a) P* ∗ MR*L
(b) P* ∗ W*L
(c) MR*L ∗ W*L
(d) P* ∗ D*L
Answer: (b) P* ∗ W*L
●● Who owns the majority of Nationwide arena?
(a) Nationwide Insurance
(b) Columbus Blue Jackets
(c) Franklin County
(d) The state of Ohio
,Answer: (c) Franklin County
●● Which is true of baseball's reserve clause?
(a) Teams retain player rights indefinitely under the reserve clause.
(b) It ended in the 1970s.
(c) The reserve clause prevented free agency.
(d) All of the above.
Answer: (d) All of the above.
●● Which of the following policies restrict pay for players in the NBA?
(a) Rookie contract structure
(b) The draft
(c) Salary cap
(d) All of the above
Answer: (d) All of the above
●● Which best describes the Coase theorem in regards to MLB players?
(a) MLB players under current contracts are traded to the teams for
which they provide the most value.
(b) MLB players are paid similar wages regardless of team.
(c) MLB players wages increased drastically when free agency was first
introduced.
, (d) Future MLB players are not well represented by the current union
representatives.
Answer: (a) MLB players under current contracts are traded to the teams
for which they provide the most value.
●● Which of the following increases player's bargaining power in the
NFL?
a) A new football league, the XFL is formed.
(b) Expected career length is lengthened by medical advances
(c) Owners only receive stadium subsidies under the condition that 1
million people per year attend games.
(d) All of the above
Answer: (d) All of the above
●● What type of market does the NFL have in purchasing professional
football labor?
(a) Monopsony
(b) Monopoly
(c) Competitive
(d) Competitive Monopoly
Answer: (a) Monopsony
COMPREHENSIVE EXAM SCRIPT VERIFIED
QUESTIONS AND SOLUTIONS GRADED
APLUS
●● Which of the following is a positive externality caused by subsidies
for the Columbus Crew?
a) Restaurants in the arena district will increase hiring
(b) Fans purchasing tickets will enjoy the game more.
(c) Traffic in the arena district will be terrible.
(d) All of the above
Answer: a) Restaurants in the arena district will increase hiring
●● Which is true of franchises that have recently built new stadiums?
a) Typically the team gets worse.
(b) Typically the team will be better and stay better for a long (> 10
years) period of time.
(c) Typically team performance in unaffected by new stadiums.
(d) Typically the team performs better for a short (< 10 years) period of
time.
Answer: (d) Typically the team performs better for a short (< 10 years)
period of time.
,●● How have fans benefited from new stadium construction in the last
20-30 years?
(a) Single sport stadiums have become more prevalent, providing better
viewing.
(b) Newer construction techniques have eliminated many of the
obstructed view seats.
(c) Newer stadiums are more aesthetically pleasing.
(d) All of the above
Answer: (d) All of the above
●● In the two team fixed talent model which area describes payroll for
the large market team?
a) P* ∗ MR*L
(b) P* ∗ W*L
(c) MR*L ∗ W*L
(d) P* ∗ D*L
Answer: (b) P* ∗ W*L
●● Who owns the majority of Nationwide arena?
(a) Nationwide Insurance
(b) Columbus Blue Jackets
(c) Franklin County
(d) The state of Ohio
,Answer: (c) Franklin County
●● Which is true of baseball's reserve clause?
(a) Teams retain player rights indefinitely under the reserve clause.
(b) It ended in the 1970s.
(c) The reserve clause prevented free agency.
(d) All of the above.
Answer: (d) All of the above.
●● Which of the following policies restrict pay for players in the NBA?
(a) Rookie contract structure
(b) The draft
(c) Salary cap
(d) All of the above
Answer: (d) All of the above
●● Which best describes the Coase theorem in regards to MLB players?
(a) MLB players under current contracts are traded to the teams for
which they provide the most value.
(b) MLB players are paid similar wages regardless of team.
(c) MLB players wages increased drastically when free agency was first
introduced.
, (d) Future MLB players are not well represented by the current union
representatives.
Answer: (a) MLB players under current contracts are traded to the teams
for which they provide the most value.
●● Which of the following increases player's bargaining power in the
NFL?
a) A new football league, the XFL is formed.
(b) Expected career length is lengthened by medical advances
(c) Owners only receive stadium subsidies under the condition that 1
million people per year attend games.
(d) All of the above
Answer: (d) All of the above
●● What type of market does the NFL have in purchasing professional
football labor?
(a) Monopsony
(b) Monopoly
(c) Competitive
(d) Competitive Monopoly
Answer: (a) Monopsony
