One factor the Google Ads system uses to calculate an ad’s actual cost-per-click (CPC) is the:

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  • maximum CPC bid of the ad showing in the #1 position on the page
  • maximum CPC bid of the ad showing one position lower on the page
  • location targeting of the ad showing one position lower on the page
  • cost-per-thousand impressions (CPM) of the ad showing one position lower on the page
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