4. An auctioneer holds a second-price auction for two bidders, Ann (A) and Bonnie (B), who have independent private values of the good 0, and 0 If a bidder wins, her payoff is her value 0 minus the price she pays, and if she loses, her payoff is 0. The values are independently and identically distributed, but otherwise you don't need to know the specific distributions to solve the problem. Ann and Bonnie's respective strategies are to bid some value b(e), that is, bid given their privately-known value (type). e. Suppose the good had one true value for both bidders equal to the average of 0, and e, (signals that are still ii.d.); hence, the good's true value has a common component. Suppose Ann knows Bonnie is going to bid her own evaluation 0, no matter what, but like normal, Ann doesn't know e Explain why bidding 0, is now a strictly dominated strategy for Ann.

4. An auctioneer holds a second-price auction for two bidders, Ann (A) and Bonnie (B), who have independent private values of the good 0, and 0 If a bidder wins, her payoff is her value 0 minus the price she pays, and if she loses, her payoff is 0. The values are independently and identically distributed, but otherwise you don't need to know the specific distributions to solve the problem. Ann and Bonnie's respective strategies are to bid some value b(e), that is, bid given their privately-known value (type). e. Suppose the good had one true value for both bidders equal to the average of 0, and e, (signals that are still ii.d.); hence, the good's true value has a common component. Suppose Ann knows Bonnie is going to bid her own evaluation 0, no matter what, but like normal, Ann doesn't know e Explain why bidding 0, is now a strictly dominated strategy for Ann.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

I need question 3, question 2 is only for background informati
PLEASE CHECK THIS HOW TO SOLVE
PLEASE CHECK THIS HOW TO SOLVE PLEASE TEACH EXPLAIN STEP BY STEP how to take derivititive v'
PLEASE CHECK THIS HOW TO SOLVE
Suppose that the following prisoner's dilemma game (stage game) is played repeatedly and players discount future payoffs with the common discount factor δ <1. a) Carefully specify the strategy spaces for both players, draw the extensive form game and find a subgame perfect Nash equilibrium when the stage game is played twice, and both players observe the outcome of the first play.
Jane is interested in buying a car from a used car dealer. Her maximum willingness to pay for thecar is 12 ($12,000). Bo, the dealer, is willing to sell the car as long as he receives at least 9($9,000). What is the Nash bargaining solution to this game?
Note:Hand written solution should be avoided.
1) Define Cartel and give an example. 2) Thelma and Louise are being charged for a murder/robbery. They are separated by police and interrogated. They are given the choice to confess or not to confess. The payoff matrix below identifies the years that they will each spend in jail, for the various outcomes. Louise Confess Don't Confess Confess (2 10,10 15.2 Thelma Don't Confess 2,15 3,3 a. Identify the Dominant Strategy for either player, or state that there isn't one. Remember, a "Strategy" is the players move. In this example, state "Confess" or "Don't Confess" for each player, not the payoff. b. Identify the Nash Equilibrium.
What is Revenue Equivalence Theorem for the standard auction types?
See attachments
You should show that the best response map gives a fixed-point in symmetric strategies help please