Asked by Nivedita Mehru on Sep 24, 2024
Verified
Anna's Antiques expects to get two bidders for the unique china teacup it sells.Each of the bidders can either have a high-value of $100 or a low-value of $70 with equal probability.If Anna receives $71 from the auction,she can infer that
A) Both the bidders were high value bidders
B) Both the bidders were low value bidders
C) One of the bidders was high value,while the other was low value
D) All of the above
High-Value
Refers to items or services that are of significant worth, often due to their quality, scarcity, or demand.
Low-Value
Describes items or services perceived as offering limited benefit or worth compared to their cost or other alternatives.
Expected Value
A calculated average of all possible values for a random variable, weighted by their respective probabilities.
- Calculate the anticipated monetary values and deduct bidder evaluations from auction conclusions.
Verified Answer
AS
Arana Sofia Torres3 days ago
Final Answer :
C
Explanation :
If both bidders were high-value bidders, then the teacup would have sold for at least $100, so Anna would have received more than $71. Similarly, if both were low-value bidders, the teacup would have sold for at most $70, so Anna wouldn't have received $71. Therefore, we can infer that one of the bidders was high-value and the other was low-value, resulting in a sale price of $71.
Learning Objectives
- Calculate the anticipated monetary values and deduct bidder evaluations from auction conclusions.