Q1. Team goals and behaviour. Sports teams are willing to spend money to a certain amount. Revenue increases with wins of a decreasing rate, EX: Altanta braves won their division for 8 straight years, by the fifth season, they could not sell out a playoff game. Total revenue is from: ticket sales. Local and national broadcasting rights. Licensing income. Other value revenues. Transfer from other teams in league. - Maximizing Profits or Wins? - We usually assume that firms maximize profits - Different teams might have different goals - Maximizing Profits Pi = wai) - C(Wi} lidR : MC - Maximizing Wins - Teams cannot ignore profit entirely - Win-mammizers make lower profits than profit-maximizers