1.

An auction in which an item is initially offered at a high the price that is progressively
lowered until a bid is made and the item sold.

Going,going,gone.Holding an auction can be an extremely efficient way for a seller to

set the price of its products,especially those who specialize in game theory.They have
long been a feature of the sale of art and antiques in the rooms of firms such us
Sotheby’s and Christie’s.But in recent years the have played a growing role in other parts
of the economy,ranging from the allocation of government-controlled,broadcasting
bandwidth to the awarding of work to subcontractors by governments an big firms using
competitive tendering,and even more recently the sale of goods over the internet.

An english auction is the most familiar.Bidders compete to offer higher prices and drop
out until only one remains.In a Dutch auction,the auctioneer calls out a high price then
keeps lowering it until there is buyer.There are various forms of sealed bid auctions. In a
first price sealed bid,each buyers submits a price in sealed envelope and all bids are an
opened simultaneously,with the highest offer winning.In a second (or third,fourth, and
so on) price sealed bid,the highest bidder wins but pays only the second (third,fourth)
highest price bid.

An English or Dutch auction will work well for a seller if there is more than one serious
bidder,as competition will ensure that the price is set at the level at which it not worth
more to any other bidder but the winner. Indeed,in a competitive auction the successful
bidder may end up offering more than what is being auctioned is actualy worth.This is
known as the winners curse.

Which method will generate the best price for the seller depends on how many bidder
take part and how well informed they are. Unfortunately for seller,this information is not
always available before the auction take place.

Sumber referensi:

BMP ADBI4201/MODUL 1

Adapted from “Essential Economics” Pubhlise by profil books.

Brainly.co.id

https://brainly.co.id › tugas

Given the rise in popularity of NFTs (Non-Fungible Tokens) and digital art, many ...
2. The central Bank is financial institution charged with several different functions, the
most important of which is managing a country’s monetary police.

A guardian of the monetary system. A central Bank sets short-term interest rates and
oversees the health of financial system,including by acting as lender of last resort to
commercial banks that get into financial difficulties. The federal Reserve, the central
bank of United States, was founded in 1913. The Bank of England, known affectionately
as the “ old lady of thread Needle Street”, was established in 1694, 26 years after the
creation of the world’s fisrt Central bank in Sweden.With the birth of the euro in
1999,the monetary policy powers of the central bank of 11 European countries were
transffered to a new European central bank ,based in Frankfurt.

During the 1990s there was a trend to make central banks independent from political
intervention in their day-to-day operations and allow them to set interest rates.
Independent central banks should be able to concetrate on the long-term needs of an
economy, whereas political intervention may be guided by the short-term needs of the
government. In theory, an independent central bank should reduce the risk of inflation.
Some central banks are legally required to set interest rates so as to hit an explicit
inflation target. Politicians are often tempted to exploit as possible short-term trade-off
between inflation and unemployment, even though the long-term consequence of
easing policy in this way is (most economists say) that the unemployment rate returns
to what you started with and inflation is higher. An independent central bank, because it
does not have to worry about persuading an electorat to vote for it, is more likely to act
in the best long-run interests of the economy.

Sumber referensi:

-BMP ADBI4201 / MODUL 2

-IMF eLibrary

https://www.elibrary.imf.org › book

7 The Role of Central Banks in Ensuring Financial Stability in