Tim has just inherited a signed Wayne Gretzky hockey jersey,which he would like to sell.His reservation price for the jersey is $500,and he can either place an ad in the local newspaper for $10 or sell the jersey on eBay,which will charge him 5% of the selling price.The local buyer with the highest reservation price is willing to pay $750 at most,while the two eBay bidders with the highest reservation prices are willing to pay $1,200 and $1,000,respectively.(Note that,in an eBay auction,the bidder with the highest reservation price wins,and the price paid is the reservation price of the second-highest bidder. )
-Refer to the information above.In this example,eBay has ________ economic surplus by allowing an item to end up in the hands of someone who values it ________ the person who otherwise would have bought it.
A) increased;more than
B) increased;less than
C) not changed;the same as
D) decreased;more than
E) decreased;less than
Correct Answer:
Verified
Q1: Tim has just inherited a signed Wayne
Q2: Tim has just inherited a signed Wayne
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Q8: Tim has just inherited a signed Wayne
Q9: The extra expense of shopping at a
Q10: Tim has just inherited a signed Wayne
Q11: ![]()
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