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"Education is the most powerful weapon which you can use to change the world”
– Nelson Mandela

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Q 1. How does eBay create value? 2. What potential contracting problems exist on eBay? 3. How does eBay address these problems? 4. What are the contracting costs at eBay? 5. eBay claims that it has only a small problem with fraud and misuse of the system. Does this imply that it is overinvesting in addressing potential contracting problems? Underinvesting? Explain. 6.

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1. In the era of e-commerce, e-Bay is creating value by bringing the interested buyers and sellers of an auction process on one platform at a minimal cost.