Question

sample #3: jersey sales²
jersey sales for major american sports totaled $188 billion dollars in 2020 (this is a real number). of those sales, the most of them were nfl jerseys totaling $70 billion last year. second was the nba with $30 billion last year. finally, in a distant third was the mlb with $20 billion in sales. the remaining balance was distributed across a variety of sports leagues including mls, nhl, and ncaa.

a. calculate the market share for each of the three companies. 2 pts

b. what is market concentration for the nfl and nba (top two sellers)? 2 pts

c. based on your answer to letter b, is this a competitive industry or market? 2 pts

Explanation:

Step1: Calculate NFL market share

Market share = $\frac{\text{NFL Sales}}{\text{Total Sales}} \times 100\% = \frac{70}{188} \times 100\% \approx 37.23\%$

Step2: Calculate NBA market share

Market share = $\frac{\text{NBA Sales}}{\text{Total Sales}} \times 100\% = \frac{30}{188} \times 100\% \approx 15.96\%$

Step3: Calculate MLB market share

Market share = $\frac{\text{MLB Sales}}{\text{Total Sales}} \times 100\% = \frac{20}{188} \times 100\% \approx 10.64\%$

Step4: Calculate top 2 market concentration

Concentration = $\text{NFL Market Share} + \text{NBA Market Share} = 37.23\% + 15.96\% = 53.19\%$

Step5: Evaluate market competitiveness

A highly concentrated market (top 2 hold ~53% share) means few firms control most of the market, so it is not competitive.

Answer:

A. NFL: ~37.23%, NBA: ~15.96%, MLB: ~10.64%
B. ~53.19%
C. No, this is not a competitive market; it is a concentrated market dominated by the top two sellers.