Asked by Kimberly Ambrocio on Sep 24, 2024
Verified
In a common-value auction
A) No bidder knows what the exact value of the item being auctioned
B) Each bidder has only an estimate of the value of the item
C) The value is the same for each bidder
D) All of the above
Common-value Auction
An auction format where the item for sale has the same value for everyone but the bidders have different information about that value.
Exact Value
Precise numerical value without approximation, representing the true measure or count of something.
Bidders
Individuals or entities that offer a specific price for goods, services, or assets in auctions or competitive tenders.
- Attain an understanding of common value auction mechanisms and their contrasts with private value auctions.
- Identify the pivotal importance of distributing knowledge in collective value auctions to both auction participants and organizers.
Verified Answer
MP
Marco Palmeri4 days ago
Final Answer :
D
Explanation :
In a common-value auction, no bidder knows the exact value of the item being auctioned and each bidder has only an estimate of the value. The value is the same for all bidders, hence all of the above options are correct.
Learning Objectives
- Attain an understanding of common value auction mechanisms and their contrasts with private value auctions.
- Identify the pivotal importance of distributing knowledge in collective value auctions to both auction participants and organizers.