Question 1

Consider the following market. Demand for the item is given by P = 130 - Qd, where P is price and Qd is the quantity demanded. Supply is given by P = 10 + 2*Qs, where Qs is the quantity supplied in the market. Suppose that a double auction market is conducted and repeated for 10 periods. What price would be the closest to the average price observed in period 10?

Question 1 options:

	50
	55
	70
	90

Question 2

Refer to question #1. In period 1, the price would be closest to

Question 2 options:

	30
	80
	90
	100

Question 3

Refer to question #1. Which of the following statements is true. In period 10 of the experiment,

Question 3 options:

	Consumer surplus would be larger than producer surplus
	Consumer surplus would be smaller than producer surplus
	Consumer surplus would be roughly equal to producer surplus
	There would be no consumer surplus