Imagine you are a buyer in a double oral auction with a reservation value of $10 and there is a seller asking $8
a. How much will you gain from accepting this offer?
b. If you are the only buyer, and you know that the lowest ask price is $2, should you accept this offer?
a. By accepting this offer, you will gain $2 ($10 – $8).
b. Yes. By accepting this offer, you will gain $8 ($10 – $2). If you choose to accept an offer from a different seller, your surplus will be lower. By accepting the lowest ask price of $2, you will maximize your surplus from this trade.
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The type of advertising used for an experience good is
A) informational advertising. B) persuasive advertising. C) search advertising. D) experience advertising.
For quasi-experiments,
A) there is a particularly important potential threat to internal validity, namely whether the "as if" randomization in fact can be treated reliably as true randomization. B) there are the same threats to internal validity as for true randomized controlled experiments, without modifications. C) there is little threat to external validity, since the populations are typically already different. D) OLS estimation should not be used.