ou have three tickets to a Celtics game on a night that you are going to be out of town (so the value of unsold tickets is zero to you). There are only four possible buyers of a Celtics ticket. The table below lists the respective reservation prices of these four possible buyers: Customer Reservation Price 1 $25 2 $35 3 $50 4 $60 a) How much revenue can you generate using the English auction mechanism from the sale of the first ticket? [Bids ca
You have three tickets to a Celtics game on a night that you are going to be out of town (so the value of unsold tickets is zero to you). There are only four possible buyers of a Celtics ticket. The table below lists the respective reservation prices of these four possible buyers:
Customer Reservation
1 $25
2 $35
3 $50
4 $60
a) How much revenue can you generate using the English auction mechanism from the sale of the first ticket? [Bids can be made in increments of $1.00]
b) How much revenue can you generate using the English auction mechanism from the sale of the second ticket? [Bids can be made in increments of $1.00]
c) How much revenue can you generate using the English auction mechanism from the sale of the third ticket? [Bids can be made in increments of $1.00]
d) How much total revenue can you generate using the English auction mechanism from the sale of the three tickets?
e) How much revenue can you generate if you charge a single price of $25 for the three tickets?
f) How much revenue can you generate if you charge a single price of $35 for the three tickets?
g) How much revenue can you generate if you charge a single price of $50 for the three tickets?
h) How much revenue can you generate if you charge a single price of $60 for the three tickets?
i) Which of the following prices fetches you the highest revenue if you charge a single price for the three tickets?
j) You can sell the tickets by using a single price for the tickets, or you can invite bids using an English auction to sell your tickets. Which pricing strategy should you choose?
An English auction, also known as an open ascending price auction, is one of the most common auction mechanisms used to sell goods or assets to the highest bidder. In an English auction, the price starts low and increases as bidders compete by placing increasingly higher bids. The auctioneer announces each bid, and participants must decide whether to place a higher bid or drop out of the auction.
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