We spoke about different factors to consider when getting the valuation of a team. How many factors are there to be considered based on the slides?
5
If a firm faces more risk, its value will be seen as _______ another firm with the same expected profits and less risk.
lower than
Salary caps, luxury taxes, revenue sharing, and player drafts all have a large impact on team value. Each of these policies is intended to help small-market teams, though some might ______ franchise values of all teams.
increase
In the video “How to value a sports team” which of these teams WAS NOT mentioned as a recently sold team?
Washington Commanders
The ticket prices charged by teams have been somewhat of a puzzle to economists, not because prices are too high, but because they are too ________.
low
Based on the slides basic economics suggests that raising ticket prices can have ______ effects on profits.
3
Inelastic demand means that when the price goes up, consumers’ buying habits stay about the same.
True
Price discrimination is when firms charge different customers the SAME prices for identical goods.
False
In price discrimination tactics, many franchises will sell identical seats at different prices, depending on who buys them.
True
Demand is defined as the relationship between price and quantity of a product.
True
The law of demand states that when prices increase, consumers will want more of a good.
False
Based on the slides how many factors affect demand?
5
Based on the slides which of these is not a factor that affects demand?
Team Valuation
Based on the slides there are no benefits of having two sports team in the same city. Having two sports teams in the same city can be seen as bad for business based on the slides.
False
Capital budgeting is the process of evaluating and selecting long-term investments that are consistent with a firm’s goal.
True
One definition of financial risk is the variability of returns of an asset.
True
According to the slides, Market Risk is the need for a firm to support its operating costs.
False
How many types of risk were discussed in the slides?
4
To understand the value of a player, financial managers must understand the (MRP) of each athlete. What does the abbreviation MRP stand for?
Marginal Revenue Product
The conflicts between owners and players have led to ____ stoppages.
work
During one labor conflict with the players’ union in _____, the NFL not only canceled some games, but for others used replacement players.
1987
League policies are sometimes confusing because they are very ________ and affect various actors in unexpected ways.
complicated
As with player drafts, many fans believe that revenue sharing is designed to decrease competitive balance.
False
Based on the slides, luxury taxes are meant to improve competitive balance and promote parity.
True
