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Baseball players who hit the most home runs relative to other players usually receive the highest pay. Beginning in the mid-1990s, the typical baseball player became significantly stronger and more muscular. As one baseball announcer put it: "The players of 20 years ago look like stick figures compared with the players of today." As a result, the average number of home runs hit each year increased dramatically. Some of the increased strength that baseball players gained came from more weight training and better conditioning and diet. As some players admitted, though, some of the increased strength came from taking steroids and other illegal drugs. Taking steroids can significantly increase the risk of developing cancer and other medical problems.
a. In these circumstances, are baseball players in a prisoner's dilemma? Carefully explain.
b. Major League Baseball has begun testing players for steroids and fining and suspending players who are caught using steroids (or other illegal muscle-building drugs). Has this testing made baseball players as a group better off or worse off? Briefly explain.
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Atlas Mines has adopted a policy of increasing the annual dividend on its common stock at a constant rate of 2.75 percent annually. The firm just paid an annual dividend of $1.67. What will the dividend be six years from now?
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Roughly speaking, a merger between two firms is legal:
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