AdWords delivery question

about broad match

[jimpoo]

Let's say we are running two Ads:
A.
Keyword: 'red widget', broad match,
Maximum CPC: $0.1
Current CTR: 1%.

B.
Keyword 'discount red widget', broad match,
Maximum CPC: $0.5
Current CTR: 6%

Well, when searching 'red widget', since the keyword broad matches both two ads, and
the value of CPC * CTR of Ads B is larger than Ads A, will google display Ads B at higher position? Or only display Ads B?
If this will happen, why is Ads A necessary?

Anyone has any experience?

[eWhisper]

In the above, ad A will be shown because the query contained didn't contain discount, and ad B is specific to the word discount. (since it's broadmatched, it could also be matched to 'free red widgets' and other word variations.