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A small nation frequently finances government spending projects by auctioning one-year bonds, each with a face value of $1 million. The structure of the auction
A small nation frequently finances government spending projects by auctioning one-year bonds, each with a face value of $1 million. The structure of the auction (similar to that for US treasury bills!) is that potential buyers submit their bids in advance, and the country agrees to accept the "market-clearing" price that equates supply and demand
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