From Peter King, the latest from Yankee Stadium:
So I went to Yankee Stadium the other night to watch Yankees-Angels. Pretty cold. In the bottom of the fourth, a vendor came by. “Hot chocolate!” he yelled. “Hot chocolate!”
I looked at his badge: Hot chocolate $10.
Sixteen ounces of chocolate-flavored water. Ten bucks. I went online to try to quantify the profit margin, and the best I can figure is the Yankees must be making about $9.15 profit on each hot chocolate sold.
I guess the fact that you have a captive audience screws up one’s ability to analyze this from a purely microeconomic perspective. Then again, I went snowmobiling in Yellowstone three years ago and it was 25 below when we started out (reached a balmy 8 degrees later in the afternoon). At our lunch stop we got free hot cocoa. I probably would have paid $79 for it, but I’m assuming the snowmobile outfitter wanted return business one day and decided to take the hit.
(thanks from MooseinOhio who, unlike me, can bear to read Peter King)