You are one of five risk-neutral bidders participating in an independent private values auction. Each bidder perceives thatbidders' valuations for the item are evenly distributed between $20,000 and $50,000. For each of the following auction tdetermine your optimal bidding strategy if you value the item at $35,000.a. First-price, sealed-bid auction.O Bid $20,00.O Bid $50,00.O Bid $35,00.O Bid $32,000b. Dutch auctionO Let the auctioneer continue to lower the price until it reaches $20,000, and then yell "Minel".O Let the auctioneer continue to lower the price until it reaches $35.000, and then yell "Mine!"O Let the auctioneer continue to lower the price until it reaches $32,000, and then yell "Mine!"O Let the auctioneer continue to lower the price until it reaches $50,000, and then yell "Mine!".C.ond-price, sealed-bid auctionO Bid $50,00.O Bid $35.000O Bid $32,00.b. Dutch auction.O Let the auctioneer continue to lower the price until it reaches $20,000, and then yell "Mine"O Let the auctioneer continue to lower the price until it reaches $35,000, and then yell Minel".O Let the auctioneer continue to lower the price until it reaches $32,000, and then yell MinelO Let the auctioneer continue to lower the price until it reaches $50,000, and then yell Minel"c. Second-price, sealed-bid auction.O Bid $50,00.O Bid $35,00.O Bid $32,00.O Bid $20,000.d. English auction.O Remain active until the price exceeds $50,000, and then drop out.O Remain active until the price exceeds $20,000, and then drop outO Remain active until the price exceeds $35,000, and then drop out.O Remain active until the price exceeds $32.000, and then drop out

(a) The optimal bid for the bidder in the first price, sealed-bid auction, and each bidder think…

You are one of five risk-neutral bidders participating in an independent private values auction. Each bidder perceives bidders' valuations for the item are evenly distributed between $20,000 and $50,000. For each of the following auct determine your optimal bidding strategy if you value the item at $35,000. a. First -price, sealed-bid auction. O Bid $20,000. O Bid $50,000. O Bid $35,000. O Bid $32,000.

You are one of five risk-neutral bidders participating in an independent private values auction. Each bidder perceives bidders' valuations for the item are evenly distributed between $20,000 and $50,000. For each of the following auct determine your optimal bidding strategy if you value the item at $35,000. a. First -price, sealed-bid auction. O Bid $20,000. O Bid $50,000. O Bid $35,000. O Bid $32,000.

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

You are one of five risk-neutral bidders participating in an independent private values auction. Each bidder perceives that
bidders' valuations for the item are evenly distributed between $20,000 and $50,000. For each of the following auction t
determine your optimal bidding strategy if you value the item at $35,000.
a. First-price, sealed-bid auction.
O Bid $20,00.
O Bid $50,00.
O Bid $35,00.
O Bid $32,000
b. Dutch auction
O Let the auctioneer continue to lower the price until it reaches $20,000, and then yell "Minel".
O Let the auctioneer continue to lower the price until it reaches $35.000, and then yell "Mine!"
O Let the auctioneer continue to lower the price until it reaches $32,000, and then yell "Mine!"
O Let the auctioneer continue to lower the price until it reaches $50,000, and then yell "Mine!".
C.
ond-price, sealed-bid auction
O Bid $50,00.
O Bid $35.000
O Bid $32,00.
b. Dutch auction.
O Let the auctioneer continue to lower the price until it reaches $20,000, and then yell "Mine"
O Let the auctioneer continue to lower the price until it reaches $35,000, and then yell Minel".
O Let the auctioneer continue to lower the price until it reaches $32,000, and then yell Minel
O Let the auctioneer continue to lower the price until it reaches $50,000, and then yell Minel"
c. Second-price, sealed-bid auction.
O Bid $50,00.
O Bid $35,00.
O Bid $32,00.
O Bid $20,000.
d. English auction.
O Remain active until the price exceeds $50,000, and then drop out.
O Remain active until the price exceeds $20,000, and then drop out
O Remain active until the price exceeds $35,000, and then drop out.
O Remain active until the price exceeds $32.000, and then drop out

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