BAT Tokens, Pollution Permits and User Attention
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Questions and Answers

According to Fisher's 1911 observation, what can speculators effectively limit by withdrawing money from circulation?

  • The price of gold
  • The demand for goods
  • The money supply (correct)
  • The interest rates

    • Which type of currencies does the dynamic of speculators limiting money supply particularly apply to?

  • Currencies with limited issuance (correct)
  • Legacy fiat currencies
  • Currencies with fixed interest rates
  • Currencies with unlimited issuance

    • In the equation $P_t^{BAT} T_t^{BAT} = M^{BAT} V_t^{BAT}$, what does $V_t^{BAT}$ represent?

  • The total number of BAT transactions
  • The velocity of BAT (correct)
  • The market capitalization of BAT
  • The transaction fees for BAT

    • What does $Z^{BAT}$ represent in the context of currency usage?

    <p>The number of BAT units not used in transactions (B)</p> Signup and view all the answers

    In the equation $Q = 1 - (P + c)$, what does 'c' represent?

    <p>Marginal cost of production (A)</p> Signup and view all the answers

    If the neighbor's valuation for a clean environment is (\nu), how is the loss from the sale of Q pollution permits expressed?

    <p>(\nu Q = \nu(1 - (P + c))) (C)</p> Signup and view all the answers

    When the neighbor maximizes net benefit, which equation is solved to find the price of pollution permits?

    <p>$1 - 2P - c + \nu = 0$ (B)</p> Signup and view all the answers

    When the factory has the entire property right, what does the neighbor effectively purchase from the factory?

    <p>Some share of the pollution right which it doesn’t use (D)</p> Signup and view all the answers

    For Coase's theorem to hold symmetrically, what is a key requirement?

    <p>Well-defined property rights (B)</p> Signup and view all the answers

    According to the content, who de facto owns user attention?

    <p>Users (B)</p> Signup and view all the answers

    The exchange rate for BAT tokens is proportional to what?

    <p>The volume of services purchased (C)</p> Signup and view all the answers

    Besides well-defined property rights, what is another requirement for the validity of the symmetric version of Coase’s theorem?

    <p>Information symmetry (D)</p> Signup and view all the answers

    According to the formula provided, what will raise the exchange rate?

    <p>A lack of money in circulation (C)</p> Signup and view all the answers

    In the context of airline safety demonstrations, what behavior is mentioned as an example of de facto user attention ownership?

    <p>People often ignoring it anyway (C)</p> Signup and view all the answers

    What does $V_t^{BAT}$ represent?

    <p>The velocity of money in the economy (A)</p> Signup and view all the answers

    In the equation for the exchange rate, what does $Z_t^{BAT}$ represent?

    <p>The BAT tokens unused for exchange in period t (B)</p> Signup and view all the answers

    What is one reason given for why some $Z_t^{BAT}$ tokens may be inactive?

    <p>Users forgetting about small token amounts (D)</p> Signup and view all the answers

    What does $\gamma$ represent in the equation for expected returns from BAT?

    <p>Risk aversion term (A)</p> Signup and view all the answers

    Which of the following describes the purpose of applying the risk-free exchange rate operator (R) to the period t exchange rate?

    <p>To make it comparable to the future expected exchange rate (C)</p> Signup and view all the answers

    In the context of BAT tokens, what does $||St+1^{BAT}||$ represent?

    <p>The future expected exchange rate (B)</p> Signup and view all the answers

    What is the result of the difference between the future expected exchange rate and the time-discounted exchange rate?

    <p>The expected returns (D)</p> Signup and view all the answers

    According to the formula, what happens to the optimal number of tokens held ($z_t^{BAT}$) if the risk aversion ($\gamma$) increases?

    <p>It decreases (B)</p> Signup and view all the answers

    What assumption is made about the risk preferences of all BAT holders when calculating the economically efficient number of BAT?

    <p>They all have the same risk preferences. (A)</p> Signup and view all the answers

    In the equation $||St+1^{BAT}|| − R(St^{BAT}) = \gamma\sigma^2(St+1^{BAT})z_t^{BAT}$, what does $\sigma^2(St+1^{BAT})$ represent?

    <p>Volatility of the position (A)</p> Signup and view all the answers

    What is the significance of achieving the 'efficient frontier' in the context of modern portfolio theory and BAT?

    <p>Balancing expected returns with risk. (D)</p> Signup and view all the answers

    What does the model suggest about price stability in a token mediated economy?

    <p>Long term price stability is likely. (C)</p> Signup and view all the answers

    Which of the following is identified as a potential issue within the digital advertising ecosystem?

    <p>High levels of ad fraud. (B)</p> Signup and view all the answers

    What is 'malvertising'?

    <p>The use of advertising to spread malware. (D)</p> Signup and view all the answers

    What is a key trend regarding ad blocking?

    <p>Ad blocking is increasing significantly. (C)</p> Signup and view all the answers

    Which company was NOT mentioned in the resources as a key player in digital advertising?

    <p>Amazon (A)</p> Signup and view all the answers

    What does the acronym AIDA stand for in the context of marketing?

    <p>Attention, Interest, Desire, Action (B)</p> Signup and view all the answers

    What concern did P&G express regarding digital advertising?

    <p>The need for greater transparency and cleanliness. (D)</p> Signup and view all the answers

    What has Snowden's revelations about privacy led to?

    <p>Increased public concern about online privacy. (A)</p> Signup and view all the answers

    In the context of online advertising, who are the three idealized participants in a Coasean bargain?

    <p>Advertiser, publisher, and user (C)</p> Signup and view all the answers

    What does the acronym 'BAT' stand for in the context of the proposed Coasean bargain?

    <p>Basic Attention Token (B)</p> Signup and view all the answers

    What is the advertiser trying to purchase from the user according to the text?

    <p>User attention (D)</p> Signup and view all the answers

    In the context of the text, intermediaries in the present advertising system cause which problem?

    <p>They create costs, such that publisher revenue is less than advertiser cost. (A)</p> Signup and view all the answers

    Which of the following represents the user's valuation of website content according to the text?

    <p>Cac (C)</p> Signup and view all the answers

    According to most CMOs what can be improved with promotions?

    <p>Short-term sales (A)</p> Signup and view all the answers

    What problem do promotions fail to address effectively, according to the text?

    <p>Informing users about the product in the first place (B)</p> Signup and view all the answers

    What is described in the text as something that cannot be achieved with promotions?

    <p>Sustainable competitive advantage (D)</p> Signup and view all the answers

    Flashcards

    Fisher's Observation

    Speculators can limit money supply by withdrawing currency in anticipation of future utility.

    Limited Issuance Currency

    Currencies like Bitcoin or BAT that have a capped total supply.

    Transaction Quantity Relationship

    Describes the relationship between price, quantity, supply, and velocity of currency.

    Velocity of BAT (VtBAT)

    Average number of times each BAT token is used for purchasing services in a time period.

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    Exchange Rate (StBAT)

    The rate at which BAT is exchanged against another currency, typically USD.

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    User Compensation

    Payment to users for viewing publisher content, enhancing their attention's value.

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    Middlemen in Advertising

    Intermediaries that add no value between advertisers, users, and publishers.

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    Promotions vs. Advertisements

    Promotions boost short-term sales but don't sustain loyalty or engagement.

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    Three-Way Coasean Bargain

    A theoretical model involving advertiser, publisher, and user interactions.

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    Basic Attention Token (BAT)

    A cryptographically-secure token for facilitating user attention exchange.

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    Caa and Cap

    Caa is the cost to advertisers for user attention; Cap is what publishers monetize attention for.

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    Transaction Costs

    Costs associated with the monetization of user attention within advertising.

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    Empty Cores

    Situations where no stable agreement exists among multiple players as per Coase theorem.

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    Pollution Rights

    Legal rights to emit a specified amount of pollutants.

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    Marginal Cost (c)

    The change in total cost when one additional unit is produced.

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    Price of Pollution Permit (P)

    The selling price of the right to pollute, determined by market forces.

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    Neighbor's Valuation (ν)

    The perceived value of a clean environment by the neighbor.

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    Benefit Maximization

    The process of maximizing the net benefit from pollution rights for the neighbor.

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    Coase's Theorem

    The theory that under certain conditions, private parties can efficiently bargain over externalities if property rights are well-defined.

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    Information Symmetry

    A condition where all parties have equal knowledge about relevant information in a transaction.

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    User Attention Rights

    The concept that users inherently own the right to their own attention, despite external claims.

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    Velocity of Money (VtBAT)

    The average rate at which currency is used in transactions over a period.

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    Inactive Tokens (ZtBAT)

    Tokens not used in transactions, may be forgotten or delayed in exchange.

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    Proportional Relationship

    A condition where one value increases as another increases, affecting exchange rates.

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    Inverse Relationship

    When one value decreases as another increases, affecting currency usage.

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    Token Mediated Economy

    An economy that uses tokens to facilitate transactions and value exchange.

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    Long Term Price Stability

    The theory that tokens can maintain consistent pricing over time.

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    Attention Economy

    An economy where attention is the primary currency and resource.

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    Ad Tech

    Technology that aids in the planning, execution, and analysis of advertising campaigns.

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    Malvertising

    Malicious ads that contain harmful or deceptive content.

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    Ad Blocking

    The use of software to prevent ads from being displayed to users.

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    Privacy in Advertising

    Concerns and regulations regarding consumer data use in ads.

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    Digital Ad Industry Control

    The dominance of specific companies over online advertising markets.

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    Expected Returns

    The anticipated profit from an investment based on risk and volatility.

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    Risk Aversion (γ)

    A term representing an investor's preference for lower risk in investment returns.

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    Volatility (σ)

    The degree to which the price of an asset fluctuates over a period of time.

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    Discounted Exchange Rate

    Current exchange rate adjusted to account for future expectations and risk-free rates.

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    Efficient Frontier

    A concept from modern portfolio theory that represents the best possible return for a given level of risk.

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    Optimal Token Holding

    The ideal quantity of tokens an individual should hold based on risk and expected returns.

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    Economically Efficient Number

    The quantity of tokens held by all users that aligns with collective risk preferences.

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    Time Discounting

    Adjusting current values to reflect expectations of future values influenced by risk-free rates.

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    Study Notes

    Basic Attention Token (BAT)

    • Digital advertising is broken, with issues like middlemen, complex tracking, and ad blocking
    • Mobile advertising costs users up to $23 per month in data charges and reduces battery life by 21%
    • Over 600 million mobile devices and desktops employ ad-blocking software
    • Traditional publishers have lost 66% of their revenue over the past decade (adjusted for inflation)
    • BAT aims to create a decentralized, transparent digital ad exchange based on blockchain
    • Brave browser blocks third-party ads and trackers and measures user attention to reward publishers

    Attention Marketplace

    • Attention is a commodity
    • The ad-tech ecosystem is complex and inefficient
    • Users face privacy violations, malware, and high download costs
    • Publishers lose revenue, and advertisers struggle with attribution and fraud
    • There is a need for a transparent and efficient ad marketplace

    Value Proposition of BAT

    • Provides strong user privacy and security in viewing ads
    • Offers improved ad relevance and performance
    • Provides a fair revenue share and better reporting for publishers
    • Reduces costs for advertisers and improves ad attribution

    Basic Attention Metrics (BAM)

    • Measures user attention within the browser
    • Monitors active tab view time for ads and content
    • Accurately measures screen time and ads interacted with
    • Allows for detailed tracking of user engagement

    Token Technology (BAT)

    • Functions as a token for a decentralized ad exchange
    • Connects advertisers, publishers, and users, removing social and economic costs of existing ad networks
    • Rewards user attention, protects user privacy, and improves conversion for advertisers and yields for publishers
    • A future part of web standards, and solves the problem of monetizing content while protecting user privacy
    • Part of a blockchain-based digital advertising system
    • Based on Ethereum technology

    Token Launch Details

    • Goal of $24 million in funding (subject to market volatility)
    • Token contract address revealed prior to crowdsale launch
    • Crowdsale to be conducted within 30 days of a defined block number
    • User growth pools and budget allocations will be handled during the crowdsale

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    Related Documents

    Basic Attention Token (BAT) Blockchain Based Digital Advertising PDF

    Description

    Questions cover Fisher's observation on speculators, currency dynamics, and equations related to BAT tokens and pollution. It also touches on Coase's theorem and property rights. A variety of economic models are interrogated.

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