2. Matthew is considering selling a painting in an English auction. There are n bidders whose valuations are distributed independently and uniformly on (VL, Vu]. a) What is his expected payoff from the auction? b) A private buyer is willing to pay (VL + vu)/2. What is the minimum number of bidders required for Matthew to choose the auction rather than sell to the private buyer? (Assume Matthew is risk neutral.) 3. Two firms compete by setting quantities. Firm A has a marginal cost of 10, while Firm B has a marginal cost of 20. The demand function is given by: p = 90 – Q/2, where Q = 9A + 9B a) What are the equilibrium quantities if both firms set quantities simultaneously (Cournot competition)? b) What are the equilibrium quantities if Firm A sets quantity first (Stackelberg competition)?