Question:
The Treasury announces an auction of $10 billion par value of 52-week Treasury bills. Two billion dollars of noncompetitive bids are received. The competitive bids are as follows:
|
Price per $1 of par
|
Par value ($)
|
|
0.9200
|
3 billion
|
|
0.9194
|
3 billion
|
|
0.9188
|
4 billion
|
|
0.9180
|
2 billion
|
|
0.9180
|
2 billion
|
|
0.9178
|
6 billion
|
Compute the price per dollar of par paid by noncompetitive bidders with a one-price auction. How would this price compare to the price paid by noncompetitive bidders with a discriminatory auction?