1. Consider a business in which units take time to produce and storage can be expensive. Would you expect such a business to compete by setting quantity or by setting price?
2. Explain the nature of the winner's curse and why it occurs in a common-value auction. Why is the winner's curse not a problem for private-value auctions?
3. Suppose that three different versions of a bill (A, B, and C) appear before a committee of 12 people.
a. Four people prefer version A to version B to Version C.
b. Four people prefer version B to version C to version A.
c. Four people prefer version C to version A to Version B.