In a common-value auction
a. No bidder knows what the exact value of the item being auctioned
b. Each bidder knows the exact value of the item
c. The value is different for each bidder
d. All of the above
QUESTION 2Intense market competition is ________ for producers, since it_______.
a. Bad; erode consumer surplus
b. Bad, erode producer profits
c. Good, increase the price level in the market
d. Good; decrease the price level in the market
QUESTION 3In a common-value auction
a. No bidder knows what the exact value of the item being auctioned
b. Each bidder has only an estimate of the value of the item
c. The value is the same for each bidder
d. All of the above
QUESTION 4Intense market competition is ________ for consumers, since it_______.
a. Bad; erodes producer surplus
b. Bad, increases variety in the market
c. Good, increases the price level in the market
d. Good; decreases the price level in the market
QUESTION 5To attract more bidders, and more aggressive bidders, to your common-value auction
a. withhold relevant information about the value of the object
b. don't allow bidders to know how others are bidding
c. do not allow potential bidders to examine the object too closely
d. hold oral auctions
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