The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 8

When the university's athletic director announces that football ticket prices are being raised for next year, he is likely to say this unfortunate step has been made necessary by rising costs-perhaps the rising cost of the women's sports program. How does the cost of the women's sports program affect the marginal cost of selling a football ticket? If you are unable to think of any answer to that question, ask yourself how the prospect of a winning season affects the cost of selling a football ticket. Which plays a larger role in determining the most profitable price at which to sell football tickets: the athletic department's budget for women's sports or an excellent team?