However at the beginning of July it appears that the cost of a click was dramatically and rapidly raised by a factor of 400% or so.
Two things occurred: The ad quickly ran through it monthly budget AND as a result it stopped showing
This seems to me like a quality score factor. Every AdWords advertiser knows that low quality scores can lead to CPC prices drastically being increased in order for the ad to show up in the search results.
The thing with this is that these ads are automatically created by Google, the keywords and sometimes the landing pages are automatically created and picked by Google. So I can't understand how Google would give themselves a low quality score and thus increase the CPCs of the keywords.
Maybe I do not fully understand but the response from the Google representative, Sheetal, did not answer Mike's question. So maybe she isn't sure?
Forum discussion at Google Places Help.