At the end of performances of his Broadway play, "Cyrano de Bergerac," Kevin Kline, who starred as Cyrano, the cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Gamer 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 values for the auction item.

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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At the end of performances of his Broadway play, "Cyrano de Bergerac," Kevin Kline, who starred as Cyrano, the cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Garner,
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
OA. differed by each bidder's value of the AIDS charity.
OB. were equal to zero.
OC. differed by each bidder's rationality.
D. were the same for each bidder.
E. were equal to each bidder's common value.
C
Click to select your answer.
bidder.
values for the auction item.
Transcribed Image Text:At the end of performances of his Broadway play, "Cyrano de Bergerac," Kevin Kline, who starred as Cyrano, the cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Garner, 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 OA. differed by each bidder's value of the AIDS charity. OB. were equal to zero. OC. differed by each bidder's rationality. D. were the same for each bidder. E. were equal to each bidder's common value. C Click to select your answer. bidder. values for the auction item.
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