You may use your notes and you may work with up to four other people. If you work with someone else, put all your names on one sheet and hand in only one sheet. Each question is worth 2 points. Suppose the supply curve for NBA basketball players is vertical for wages in excess of $100k per year (their opportunity costs). Assume the demand for players intersects the supply on the vertical section of the supply curve at $2.1m per year. In the absence of labor market restrictions, $2.1m is the wage paid to the average player. There are roughly 360 NBA players. X1. Depict this situation on a graph, and label your graph carefully. 2. Explain how labor market restrictions could reduce the rents (or surplus) received by players X3. Calculate the gain to an owner of a team with 12 players if he could reduce wages to the players' opportunity costs. 4. For the league as a whole, what area of the graph does this correspond to? NAWAWW The following questions can be drawn on the same graph (please label everything on the graph to get full credit) - Clemson's stadium seats 90,000 people (assume MC-0). You may use your notes and you may work with up to four other people. If you work with someone else, put all your names on one sheet and hand in only one sheet. Each question is worth 2 points. Suppose the supply curve for NBA basketball players is vertical for wages in excess of $100k per year (their opportunity costs). Assume the demand for players intersects the supply on the vertical section of the supply curve at $2.1m per year. In the absence of labor market restrictions, $2.1m is the wage paid to the average player. There are roughly 360 NBA players. X1. Depict this situation on a graph, and label your graph carefully. 2. Explain how labor market restrictions could reduce the rents (or surplus) received by players X3. Calculate the gain to an owner of a team with 12 players if he could reduce wages to the players' opportunity costs. 4. For the league as a whole, what area of the graph does this correspond to? NAWAWW The following questions can be drawn on the same graph (please label everything on the graph to get full credit) - Clemson's stadium seats 90,000 people (assume MC-0)