A sports team is not selling out their games very often (this means that they are not selling all of their tickets each game and there are empty...

1. A sports team is not selling out their games very often (this means that they are not selling all of their tickets each game and there are empty seats). Is this an indication that their ticket pricing strategy is not optimal? Why or why not?

2. How can a price ceiling on tickets lead to scalping? Is price an effective rationing mechanism under a binding price ceiling? Why or why not?

3. A team raises its ticket prices after signing an amazing new player. Did the team do this to offset the cost of the player's expensive new contract, or for some other reason? Explain.

4. Suppose the Tampa Bay Rays charge $10 for a bleacher seat and sell 250,000 over the course of a season. Next season, they increase the price to $12 per bleacher seat and sell 200,000. What is the elasticity of demand for bleacher seats at Rays games?

5. How does being in a "big market" affect a team? Specifically, what impact does it have on that team's revenue and wins (on average)? Why?

6. Does a team that is trying to maximize wins behave the same as a team trying to maximize profits? Why/Why not?

7. Explain what revenue sharing is and provide an example.

8. List the five main sources of revenue for sports franchises and explain how each source of revenue is earned.

9. Explain how broadcast revenue for NFL teams is structured differently than broadcast revenue for MLB teams.

10. Explain "vertical integration" and how it is related to Regional Sports Networks (RSNs).