12. For decades, the mob ran a numbers game in which participants who matched three numbers chosen...
Question:
12. For decades, the mob ran a “numbers game”
in which participants who matched three numbers chosen at random would win a prize. In the 1970s, state governments began authorizing state lottery commissions; those commissions typically offered games similar in structure to the numbers game. Using supply and demand analysis:
a. Predict the effect of the creation of state lotteries on the number of people playing numbers-type games.
b. Predict the effect of the creation of state lotteries on the number of people playing mobrun numbers games.
c. Predict the effect of the creation of state lotteries on the price of playing a numbers-type game.
d. Numbers games are unusual in that tickets don’t typically vary in their nominal price — most tickets sell for exactly $1. Given that the nominal price is fixed, how might the price change you indicated in
(c) be achieved?
Step by Step Answer:
Microeconomics
ISBN: 9780716759751
1st Edition
Authors: Austan Goolsbee, Steven Levitt, Chad Syverson