_2d Case._ (One-sided competition of Buyers or Sellers.) First, of Buyers. Suppose, instead of one peasant, there are three, B₁ B₂ and B₃ bidding for one horse. B₁ values it at £60: B₂ considers it worth £50: B₃ thinks it worth only £40. Only one can get the horse; but, as S values his horse at £20 only, any of the three buyers may get it. Accordingly they will bid against each other till the figure goes above £40, when B₃ retires from the competition: above £50 B₂ is excluded, and B₁ is left the sole competitor. Then, as in the former case, the price will be fixed somewhere between £60, the subjective valuation of the purchaser, and £50, that of the most capable of the excluded competitors, or, as we should say, between the subjective valuation of the successful and that of the first unsuccessful buyer. The case of one-sided competition of Sellers is the exact converse of the above. _3d Case._ This is the ordinary case of what may be called complete competition—where there are several buyers and several sellers of similar articles. Suppose the case of six buyers each wishing to purchase a barrel of apples, and five sellers each wishing to dispose of one barrel. We assume that the barrels are all of equal quality and offered simultaneously, and that the competitors on both sides know their own interests and follow them. Buyer 1 values the barrel Seller 1 values the barrel at 18/6 at 13/ and will pay any price under and will accept any price above ---------------------------------------------------------------- Buyer 2 ” 18/ Seller 2 ” 14/ Buyer 3 ” 17/6 Seller 3 ” 15/ Buyer 4 ” 17/ Seller 4 ” 16/ Buyer 5 ” 16/ Seller 5 ” 17/ Buyer 6 ” 15/ Here the subjective valuation which the first three buyers put upon the apples is so high that they are, economically, “capable” of purchasing from any of the sellers. But, naturally, they will not pay more than necessary, and the transaction begins by low offers on the side of the buyers, and holding back on the side of the sellers. Let us follow the course of the bids methodically. At 13/6 there are 6 Buyers and 1 Seller 14/ ” 6 ” 1 ” 14/6 ” 6 ” 2 ” 15/ ” 5 ” 2 ” 15/6 ” 5 ” 3 ” 16/ ” 4 ” 3 ” 16/1 ” 4 ” 4 ” 16/6 ” 4 ” 4 ” 16/11 ” 4 ” 4 ” 17/ ” 3 ” 4 ”