Asked by chase haines 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 knows the exact value of the item
C) The value is different for each bidder
D) All of the above
Common-value Auction
A bidding process where the item's true value is identical across all participants, though individual bidder estimates of this value may vary.
Exact Value
The precise numerical amount or measurement of an item, without approximation or rounding.
Bidders
individuals or entities that offer a price for goods, services, or assets in auctions or competitive bidding scenarios.
- Acquire knowledge about the notion of common value auctions and the ways in which they are differentiated from private value auctions.
Verified Answer
SS
Simranjeet Singh2 days ago
Final Answer :
A
Explanation :
In a common-value auction, no bidder knows what the exact value of the item being auctioned is. The value may be different for each bidder, but they do not know the exact value. Therefore, option A is the correct choice.
Learning Objectives
- Acquire knowledge about the notion of common value auctions and the ways in which they are differentiated from private value auctions.