Go to the basketball-reference Website http://www.basketball-reference.com and find the average game statistics and salary (one year) of an NBA player of your choice. Use Berris equation for a players MRP to determine what this player is worth and compare it with his actual salary. Use any player except for LeBron James 2020-2021 (we already used him in class). According to Berri, the number of games a player is expected to win for his team is approximated by:

2 (points + rebounds + steals + 1/2 blocked shots + 1/2 assists) (field goal attempts + 1/2 free throw attempts + turnovers + 1/2 personal fouls) 1. Use averages to calculate the players win score. A win is worth approximately $1.913 million to a team. Use the worth of a win and the players win score to estimate the players Marginal Revenue Product. Show your working. (4 points) 2. Is the player paid accurately, are they underpaid, or are they overpaid? Explain. (3 points) 3. What are some possible causes for why the player is underpaid/overpaid/paid accurately? For example, is the athlete early in his career? Are there any league rules or policies that affect his pay? Does collective bargaining favor the athlete because he is late in his career? Does the athlete have superstar power that contributes to his value? (4 points) Using the data in the table below, answer the following questions and determine if WNBA players are being paid fairly for their work: NBA WNBA 2015-2016 Total Team Revenue $5.9 billion $51.5 million (at minimum) Total players with minutes in 2017 439 157 Average salary $6.4 million $75,000 *Data from David Berris (2017) article in Forbes, NBA player Minute Statistics, and Statistica **Be careful with billions vs millions etc. 4. What percentage of total league revenues were being paid to players in the NBA and the WNBA in 2017? (3 points) 5. If the WNBA paid the same percentage of their revenues to their players as the NBA, how much would the average salary be in the WNBA in 2017? (3 points) 6. Use the concept of Marginal Revenue Product to evaluate whether WNBA players were being paid fairly in 2017. (3 points) 7. In 2020, WNBA players agreed to a new CBA that raised total compensation by approximately 53%. Do you think a pay increase was

3 warranted for WNBA players? Why? Should WNBA players be paid the same as NBA players? Why? Use MRP in your answers. (4 points) Proponents of university athletics departments list many reasons why athletics benefits the university. One reason is that select athletics departments are profitable. Use Statements of Revenues, Expenses and Changes in Net Position of page 25 of the University Athletic Association Financial Statements 2018-2019 to answer the following questions: 8. What was the operating income or loss for the department in 2019 and 2018? (2 points) 9. What was the operating income or loss for the department in 2019 and 2018 if Student Fees and Direct State Support are removed from the revenues? (3 points) 10. What is the operating income or loss for the department in 2018 and 2019 if scholarships are removed from the expenses? (3 points) 11. Should scholarships be counted at their full value as a cost to university athletic departments? Why or why not. (4 points) 12. Was the University of Floridas athletics department profitable in 2018 and 2019? Explain. (2 points) The NCAA has been described as a cartel that gives university athletic departments monopoly power to exploit college athletes. We can compare college sport to professional sport estimate the value of athletes in revenue generating sports. For example, to estimate the value of college football players we can use professional football as a guide: If 48% of team revenues are shared with players in the NFL, we can assume that is what college players would be worth too. So to estimate a scholarship players worth we can use this equation: Average value= Football team revenues x 0.48 Number of players on scholarship 13. In 2019 University of Florida earned $87,450,485 in football revenues and there were 78 scholarship athletes. Calculate the average value of University of Florida scholarship athletes on the team. (4 points)

4 14. In 2019 Florida State University earned $71,500,000 in football revenues and there were 84 scholarship athletes on the team. Calculate the average value of Florida State University scholarship athletes. (4 points) 15. Using MRP, give two reasons why University of Florida football players were more valuable in 2019 than Florida State University football players.