Reference no: EM132465662

You and your best friend Ted are considering going to see a UConn men's basketball game in Storrs. The men's team is second in the nation and their opponent Temple is ranked fourth. You and Ted live in Stamford. You and Ted have identical (and excellent!) tastes. At 2PM, Ted (semi-retired) goes to a Ticketmaster and buys a non-refundable $30 ticket for tonight's game. Meanwhile, you cannot get to the Ticketmaster outlet (Ted never offers to get you one...) and you plan to buy your ticket at the game. Tickets sold at the game cost $25 as there is no Ticketmaster charge. Many people nonetheless pay the higher price at Ticketmaster to be sure of getting good seats. At 4 PM, an unexpected snowstorm begins, making the prospect of driving to Storrs much less attractive than before, but ensuring the availability of good seats.

1. If both you and Ted are rational, is one of you more likely to attend the game than the other?
2. Now consider a different scenario: assume that Jack and Fred are going to a hockey game at Yale. Jack has bought his ticket from Yale through the mail for $25. Fred is planning to buy a ticket at the game and that it will cost $25. When you get to New Haven, you discover that Jack has somehow lost his ticket and Fred has somehow lost $25 in cash. (Probably when they stopped for a drink along the way...). Who is more likely to go to the game? Why?