Refer to the table below. Recall that the bidders only know their own private value of the item and they do not know the other participants' private values. Further, assume each participant will submit bids using their optimal strategy. If the participants are bidding in a sealed-bid first-price auction, Bidder ________ wins the auction and pays ________.
The table above lists the independent private values of five participants in an auction. Each of the bidders only knows their own value and does not know the private values of the other participants.
A) #3; $10 million
B) #5; 9.5 million
C) #5; a value less than $10 million and greater than $9.5 million
D) #3; a value less than $10 million and greater than $9.5 million
D) #3; a value less than $10 million and greater than $9.5 million
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Refer to Cournot Problem. Each firm will produce.
Consider a Cournot oligopoly with two identical firms. These firms each have constant marginal costs of $10. The market for these firms’ product has demand Q = 100 - P. a. 22.5 units b. 30 units. c. 45 units. d. 90 units.
The characteristic of ease of entry and exit ensures that perfectly competitive firms will be able to earn positive economic profits over the long run
Indicate whether the statement is true or false
If the current price is less than the market clearing or equilibrium price, we would expect:
A) a surplus. B) downward pressure on price. C) upward pressure on price. D) no change in the market price.
When the Fed makes an open market purchase, long-term real interest rates will ________, which will ________ GDP
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease