Deck 13: The Business of Sport

Question 1

Which of the following leagues/associations is currently the largest with 32 teams?

A) NBA
B) NHL
C) MLB
D) NFL

Answer 1

D

Question 2

The political economy of sport can be said to include all of the following, except:

A) the study of production, consumption, and economic transactions
B) the relationship between law and government and economic transactions
C) the distribution of wealth and income in economies
D) an analysis of the internal workings of local sport organizations

Answer 2

D

Question 3

The monopsony power of leagues has been strengthened over the years through policies that did all of the following EXCEPT?

A) Restricted player movement
B) Increased profit for owners
C) Increased salaries for players
D) Alienated athletes from their labour

Answer 3

C

Question 4

The reverse entry draft format does all of the following, except:

A) generate monopsony power for teams
B) reduces salaries for incoming players
C) guarantees profits for the team
D) enhances competitive balance between teams

Question 5

A/An _____ is a market with only one firm demanding labour for production.

A) Monopsony
B) Cartel
C) Oligarchy
D) Monopoly

Question 6

A work stop

A) Lockout
B) Strike
C) Cartel
D) collective bargain

Question 7

In terms of U.S. millions of dollars, which of the following Canadian professional sports franchises is the most valuable?

A) Montreal Canadiens
B) Toronto Blue Jays
C) Toronto Raptors
D) Toronto Maple Leafs

Question 8

How have professional athletes responded to monopsony power in most cases?

A) by striking periodically in order to take control of the league
B) by forming players' unions that bargain with the leagues
C) by specifically lobbying broadcasting corporations for a greater share of their profits by engaging in on-court/field/rink player protests against league commissioners

Question 9

Throughout North America, professional team sport leagues operate as closed, which means league executives control all of the following EXCEPT:

A) When new franchises can enter the league
B) What name a team must have
C) Where franchises are located
D) Who can own teams in the league

Question 10

If you were to study one of the recent lockouts in the NBA, NFL or MLB, you would see that they give an opportunity for:

A) Players to collectively resist their oppression by refusing to work
B) Fans to resist their exploitation by demanding lower prices for tickets, merchandise, TV subscriptions and other goods and services
C) The media, including broadcasters, to demand a greater share of the revenue of professional sports
D) Team owners to apply pressure on players to agree to the team's demands

Question 11

Which of the following leagues has the highest average franchise value, at $2.6 billion?

A) MLB
B) NBA
C) NFL
D) NHL

Question 12

Winfree and Rosentraub (2012) note three main factors led to the emergence of professional team sports in the early 1900s. Which of the following was NOT one of the three?

A) Increased media attention given to sports
B) Urbanization
C) Increased expendable income of workers
D) Increased leisure time of workers

Question 13

Which of the following is TRUE of the reserve clause?

A) While the reserve clause existed at the onset of professional sports leagues, it no longer exists in any form today.
B) The reserve clause allows players the opportunity to negotiate with other teams for higher pay and other incentives.
C) In North America, players must play a specified number of seasons according to the reserve clause and then qualify for free agency.
D) The reserve clause has been, and is, promoted by players' associations as most beneficial for professional athletes.

Question 14

If an NHL team decides to intentionally lose in order to secure a higher draft pick, it could be said that this team has acted in their own self-interest and therefore gone against agreements set out through the league's implicit _____.

A) Franchise system
B) Monopsony system
C) Cartel system
D) Bargaining system

Question 15

In 2009, the co-founder of Blackberry, Jim Balsillie, was blocked by the NHL in his efforts to purchase the Coyotes team and move it to which Canadian city?

A) Quebec City
B) Hamilton
C) Waterloo
D) Kingston

Question 16

The two important structural elements in sports leagues, according to Neale (1964), are:

A) Uncertainty of outcome and competitive balance
B) Competitive balance and a profit maximization model
C) Uncertainty of outcome and a cartel system
D) A cartel system and a profit maximization model

Question 17

The largest amount of revenue generated by the NFL comes from what source?

A) Corporate sponsorship
B) Merchandise
C) Ticket sales and concessions
D) Broadcasting rights fees

Question 18

A _____ is a group of two or more firms that formally agree to coordinate their production and pricing decisions to maximize joint profits.

A) Monopoly
B) Monopsony
C) Cartel
D) free agency group

Question 19

A market with only one firm supplying a product or service is referred as a/an:

A) Monopsony
B) Cartel
C) Oligarchy
D) Monopoly

Question 20

In the mid-1990s, all of the new US-based CFL teams folded except for the team from which city, which relocated to Montreal?

A) Las Vegas
B) Memphis
C) Baltimore
D) Shreveport

Question 21

One of your friends is arguing with you about the supposed benefits and drawbacks of new stadiums being constructed for professional sports teams. Which of the following statements would NOT be true?

A) Significant portions of the cost of building new stadiums are typically covered by tax revenue provided by citizens
B) Academic research in the last 3 decades has shown that sports facilities provide significant new economic impacts in surrounding communities
C) New facilities are not necessarily constructed because old facilities are unsafe, but rather because they can use new facilities to maximize revenue through new amenities like restaurants and luxury boxed
D) The reason most often cited to justify the expenditure of public funds on new stadiums is economic impact

Question 22

You are explaining to a friend the business of sport and note that _____ are the largest operating expense for each team in North American professional sports.

A) facility operating costs
B) players' salaries
C) travel expenses to away games
D) medical expenses for injured players

Question 23

Proponents of maintaining the status quo believe that hockey players in the Canadian Hockey League are fairly compensated because:

A) They receive salaries far above minimum wage
B) They receive stock options for the teams they play for
C) They receive subsidized tuition for their undergraduate degree after retiring from the CHL
D) They are given testimonials where specific players are awarded all of the gate receipts of certain exhibition matches

Question 24

Which individual or group typically benefits the most from new facility construction projects?

A) Local businesses, through increased revenue
B) Local residents, through jobs and tax breaks
C) Team owners, through increased revenue streams
D) The players, through salary benefits

Question 25

Regarding the average attendance of NFL and MLB games, which of the following statements is true?

A) NFL attendances are approximately double those of MLB games
B) NFL attendances are approximately triple those of MLB games
C) MLB and NFL attendances are similar
D) Since 1990, the proportionate difference between attendances of NFL and MLB games has shifted markedly

Question 26

The decision-making of the IOC appears to focus on all of the following EXCEPT:

A) Improve the lives and respect the wishes and needs of local residents living in the host city
B) Broadcast its Olympic events around the world
C) Maximizing returns from the rights to host Olympic Games
D) Generate maximum exposure from its symbols

Question 27

North American sports franchises generate revenue from five sources. Which of the following is NOT one of these sources?

A) game day ticket sales, concessions, and parking
B) local television and radio broadcasting agreements
C) international advertising
D) postseason appearance revenue

Question 28

When the city of Calgary proposed a bid to host the 2026 Winter Olympics, what percentage of residents voted down the proposal in a 2018 referendum?

A) 51%
B) 56%
C) 61%
D) 66%

Question 29

Which of the following best reflects price discrimination in professional sports ticket sales?

A) a discount for students at an MLB game
B) higher cost for seats closer to the ice at a hockey game
C) seats behind or close to a pillar at an NBA game
D) seats in the "nosebleed" section of an arena

Question 30

Typically, legacies of hosting sports mega events come in three main forms. Which of the following was NOT listed in the text as one of these forms?

A) Local security
B) Advertising effects on the profile of the host city
C) Infrastructure
D) Residents housing