WTB: Lamborghini freeroll GRAND FINAL ticket (stars will transfer these)
09-08-2010
, 03:30 AM
Quote:
The calculations that two2brains has posted above are good. However, they do not accurately reflect a considerable amount of the value of a ticket. Those calculations do not account for:
D) The payout structure of the both the weekly tournaments and the Grand Final are extremely wide.
A) the accurate number of participants in the Grand FinalA) Accurate number of participants in the Grand Final
B) the accurate number of participants in the weekly finals
C) the value of the Grand Final tickets awarded in the weekly finals was inaccurate making the value of the weekly final tickets inaccurate
D) the pay-out structure of these tournaments adds significant value to those finishing earlier in the field (the vast majority of players)
E) other tangible costs resulting from there being no direct buy-in for these tournaments
F) the fact that those selling these tickets are selling to their direct competitors lowers the current holder's $EV from the tournament.
G) demand for the tickets is higher than the supply.
After 6 weekly finals there are 11,158 participants in the Grand Final. There are 2,000 qualifiers per weekly final. We should assume that the number of people who have un-registered is negligible. Thus, the only reason for less than 2,000 per week is duplicate registrants. There were no duplicate registrants the first week. We will ignore the fact that number of duplicate registrants is non-linear over time. [As the number of registrants increases, the number of possible duplicates increase. In addition, prior registrants, in general, have demonstrated an edge over the field and thus are more likely to duplicate register multiple times.]B) Accurate number of participants in weekly final:
Thus, 11,158 - 2,000 = 9,158 additional registrants in 5 weekly finals where duplication was possible. 9,158/5 = 1,831.6 new registrants each week. Total registrants over 9 weeks is 2,000 + (8*1,831.6) = 16,653 total registrants expected in the Grand Final.
two2brains showed the total prize pool of the Grand Final to be: $450,000. Thus, the value of each ticket is:
$450,000 / 16,653 = $27.02 + 10% vig = $29.73.
Given that the number of duplicate participants who can not use an additional Grand Final ticket will probably increase with each week, the above value is probably low.
The number of participants in the weekly finals have been: 6,655; 5,578; 6,891; 7,077; 7,320; and 7,191 for an average of 6,785.C) Value of Grand Final Tickets was inaccurate (due to (A), above) in the weekly prize pool calculation.
Weekly prize pool is: $100,000 + $29.73 * 2,000 = $159,449.46
Using the average number of participants this results in a Weekly Final ticket price of:
$159,449.46 / 6785 = $23.50 + 10% vig = $25.85
Using the lowest number of participants in a Weekly Final results in a ticket price of:
$159,449.46 / 5578 = $28.59 + 10% vig = $31.44
D) The payout structure of the both the weekly tournaments and the Grand Final are extremely wide.
The weekly tournaments start paying at 4,000th place, and you get a ticket to the Grand Final at 2,000th place. Thus, almost 59% of the field gets paid, and almost 29.5% of the field gets a ticket to the Grand Final. A "normal" payout structure on PokerStars pays about 14.65% of the field with very few paying a higher percentage and many paying down in the 10.5% ballpark.E) There is no direct buy-in to these tournaments.
Cost of a ticket to a tournament that pays an equivalent amount to lower placing players:
About 14.65% of the average field is 994th place. Let's round to 1,000th place.
At 1,00th place you get: $30.00 (cash) + $29.73 (Grand Final ticket). So, $59.73.
Thus, an ticket to a tournament with equivalent payouts to the Weekly Final for lower placing finishers would normally cost you $59.73. Admittedly, such a tournament would have much higher prizes for the final table. What the ticket is worth to a purchaser is going to depend on where they think they will end up finishing.
Those that have tickets have spent time and/or money to obtain the tickets. Given variance, each ticket requires multiple entries to the tournaments awarding the tickets. Even if you are willing to spend the time and/or money to obtain a ticket, there is no guarantee that you be able to do so.F) Each ticket transferred definitely introduces a direct competitor for the prize pool without increasing the prize pool.
The Grand Final ticket price does not reflect the fact that you must win it by spending the time, having the skill, and being lucky enough to win it.
This significantly lowers the $EV for the person that is selling the ticket. This is a real value that not transferring the ticket has to the person holding the extra ticket over and above the "actual" dollar equivalent value of the ticket.G) The supply of the both Weekly Final and Grand Final tickets is strictly limited.
The demand for the tickets is significantly higher than the supply. It takes a considerable amount of time, effort, skill and luck to obtain a Weekly Final ticket.All things considered, the marketplace should determine that the trading price for each ticket, particularly the Grand Final tickets, is significantly higher than the "book" values calculated above.
The supply of Grand Final tickets is extremely limited. Even if you can guarantee to play a perfect game of poker, you can not accumulate more than one Grand Final ticket per week. In the real world, variance will result in not being able to obtain even that many. Thus, the supply of Grand Final tickets will be very, very small.
The model is commonly applied to wages, in the market for labor. The typical roles of supplier and demander are reversed. The suppliers are individuals, who try to sell their labor for the highest price. The demanders of labor are businesses, which try to buy the type of labor they need at the lowest price.
The equilibrium price for a certain type of labor is the wage rate.
A number of economists (for example Pierangelo Garegnani, Robert L. Vienneau, and Arrigo Opocher & Ian Steedman), building on the work of Piero Sraffa, argue that that this model of the labor market, even given all its assumptions, is logically incoherent. Michael Anyadike-Danes and Wyne Godley argue, based on simulation results, that little of the empirical work done with the textbook model constitutes a potentially falsifying test, and, consequently, empirical evidence hardly exists for that model. Graham White argues, partially on the basis of Sraffianism, that the policy of increased labor market flexibility, including the reduction of minimum wages, does not have an "intellectually coherent" argument in economic theory.
This criticism of the application of the model of supply and demand generalizes, particularly to all markets for factors of production. It also has implications for monetary theory not drawn out here.
In both classical and Keynesian economics, the money market is analyzed as a supply-and-demand system with interest rates being the price. The money supply may be a vertical supply curve, if the central bank of a country chooses to use monetary policy to fix its value regardless of the interest rate; in this case the money supply is totally inelastic. On the other hand, the money supply curve is a horizontal line if the central bank is targeting a fixed interest rate and ignoring the value of the money supply; in this case the money supply curve is perfectly elastic. The demand for money intersects with the money supply to determine the interest rate.
Demand and supply relations in a market can be statistically estimated from price, quantity, and other data with sufficient information in the model. This can be done with simultaneous-equation methods of estimation in econometrics. Such methods allow solving for the model-relevant "structural coefficients," the estimated algebraic counterparts of the theory. The Parameter identification problem is a common issue in "structural estimation." Typically, data on exogenous variables (that is, variables other than price and quantity, both of which are endogenous variables) are needed to perform such an estimation. An alternative to "structural estimation" is reduced-form estimation, which regresses each of the endogenous variables on the respective exogenous variables.
Macroeconomics and you:
Demand and supply have also been generalized to explain macroeconomic variables in a market economy, including the quantity of total output and the general price level. The Aggregate Demand-Aggregate Supply model may be the most direct application of supply and demand to macroeconomics, but other macroeconomic models also use supply and demand. Compared to microeconomic uses of demand and supply, different (and more controversial) theoretical considerations apply to such macroeconomic counterparts as aggregate demand and aggregate supply. Demand and supply are also used in macroeconomic theory to relate money supply and money demand to interest rates, and to relate labor supply and labor demand to wage rates.
The phrase "supply and demand" was first used by James Denham-Steuart in his Inquiry into the Principles of Political Oeconomy, published in 1767. Adam Smith used the phrase in his 1776 book The Wealth of Nations, and David Ricardo titled one chapter of his 1817 work Principles of Political Economy and Taxation "On the Influence of Demand and Supply on Price".
In The Wealth of Nations, Smith generally assumed that the supply price was fixed but that its "merit" (value) would decrease as its "scarcity" increased, in effect what was later called the law of demand. Ricardo, in Principles of Political Economy and Taxation, more rigorously laid down the idea of the assumptions that were used to build his ideas of supply and demand. Antoine Augustin Cournot first developed a mathematical model of supply and demand in his 1838 Researches into the Mathematical Principles of Wealth, including diagrams.
During the late 19th century the marginalist school of thought emerged. This field mainly was started by Stanley Jevons, Carl Menger, and Léon Walras. The key idea was that the price was set by the most expensive price, that is, the price at the margin. This was a substantial change from Adam Smith's thoughts on determining the supply price.
In his 1870 essay "On the Graphical Representation of Supply and Demand", Fleeming Jenkin in the course of "introducing the diagrammatic method into the English economic literature" published the first drawing of supply and demand curves therein, including comparative statics from a shift of supply or demand and application to the labor market. The model was further developed and popularized by Alfred Marshall in the 1890 textbook Principles of Economics.
The power of supply and demand was understood to some extent by several early Muslim economists, such as Ibn Taymiyyah who illustrates:
"If desire for goods increases while its availability decreases, its price rises. On the other hand, if availability of the good increases and the desire for it decreases, the price comes down."
At least two assumptions are necessary for the validity of the standard model: first, that supply and demand are independent; and second, that supply is "constrained by a fixed resource"; If these conditions do not hold, then the Marshallian model cannot be sustained. Sraffa's critique focused on the inconsistency (except in implausible circumstances) of partial equilibrium analysis and the rationale for the upward-slope of the supply curve in a market for a produced consumption good. The notability of Sraffa's critique is also demonstrated by Paul A. Samuelson's comments and engagements with it over many years, for example:
"What a cleaned-up version of Sraffa (1926) establishes is how nearly empty are all of Marshall's partial equilibrium boxes. To a logical purist of Wittgenstein and Sraffa class, the Marshallian partial equilibrium box of constant cost is even more empty than the box of increasing cost."
Aggregate excess demand in a market is the difference between the quantity demanded and the quantity supplied as a function of price. In the model with an upward-sloping supply curve and downward-sloping demand curve, the aggregate excess demand function only intersects the axis at one point, namely, at the point where the supply and demand curves intersect. The Sonnenschein-Mantel-Debreu theorem shows that the standard model cannot be rigorously derived in general from general equilibrium theory.
The model of prices being determined by supply and demand assumes perfect competition. But:
"...economists have no adequate model of how individuals and firms adjust prices in a competitive model. If all participants are price-takers by definition, then the actor who adjusts prices to eliminate excess demand is not specified".
The problem is summarized in the Ackerman text:
"If we mistakenly confuse precision with accuracy, then we might be misled into thinking that an explanation expressed in precise mathematical or graphical terms is somehow more rigorous or useful than one that takes into account particulars of history, institutions or business strategy. This is not the case. Therefore, it is important not to put too much confidence in the apparent precision of supply and demand graphs. Supply and demand analysis is a useful precisely formulated conceptual tool that clever people have devised to help us gain an abstract understanding of a complex world. It does not - nor should it be expected to - give us in addition an accurate and complete description of any particular real world market."
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