cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and

Question

cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Garner A the and of performancoes of his Broadway play, roserano de Brerac Kevin Kline, who stared as Cyrano,the autographed to benefit Broadway Cares in its fight against AIDS An English auction was used. One night, a television producer grabbed the nose for $1,400, while the next night it fetched $1,600. On other nights it sold for $3,000 and $900. Source: (Mitchell, Dan, "This Time, Santa Has Been Too Naughty," New York Times, December 9, 2007) Why did the value fluctuate substantially from night to night? The value of the nose fluctuated from night to night because the bidders have Which bidder's bid determined the sales price? The bidder whose value determined the sales price was the How was the auction price affected by the audience's knowledge that the proceeds would go to charity? Why Since proceeds went to the AIDS charity, private values I values for the auction lem- bidder A. differed by each bidder's value of the AIDS charity O B. were equal to zerco. O C. differed by each bidder's rationality 0 D. were the same for each bidder O E. were equal to each bidder's common value Click to select your answer

Explanation / Answer

The value fluctuated as the bidders have different values for the auction item. The highest bidder’s bid determined the sale price. The knowledge that the proceeds would go to charity led to more variation in the bid due the differe In each bidder’s value of the AIDS charity. Similarly their private values differed dur to (A).

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