Asked by GERMANE ARMSTRONG on Sep 24, 2024
Verified
If the bidders at a first-price auction have true values of $78,$72,$66,and $65,the item will sell for
A) Just above $78
B) just over $72
C) $78
D) $72
First-Price Auction
A type of auction in which the highest bidder wins and pays the amount of their bid.
True Values
Genuine or inherent values that are not influenced by external factors.
Selling Price
The amount of money for which a product or service is sold to buyers.
- Highlight the strategic discrepancies between participating in first-price and second-price auctions.
Verified Answer
MP
Manuelinha Peris3 days ago
Final Answer :
C
Explanation :
In a first-price auction, the highest bidder wins the item and pays the amount they bid. Therefore, the item will sell for the highest bidder's bid. In this case, the highest bidder has a true value of $78, so the item will sell for $78.
Learning Objectives
- Highlight the strategic discrepancies between participating in first-price and second-price auctions.