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Suppose a search engine has three ad slots that it can sell. Slot a has a clickthrough rate of 5, slot b has a

clickthrough rate of 2, and slot c has a clickthrough rate of 1. There are three advertisers who are interested in these slots. Advertiser x values clicks at 3 per click, advertiser y values clicks at 2 per click, and advertiser z values clicks at 1 per click. Compute the socially optimal allocation and the VCG prices for it. Give a brief explanation for your answer.

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