Answer Happy

Suppose there are three bidders whose valuations of an item in a private-value auction are $100, $70, and $55. If the auction is an English auction and you are the bidder whose valuation of the item is $100, what should you bid? You should continue making bids up to $ . (Enter a numeric response using an integer.) When using your dominant strategy, will you win the item? If so, what will you pay? When using your dominant strategy, you will O A. win the item with a bid of $100.01. OB. win the item with a bid of $100. OC. win the item with a bid of $55. OD. win the item with a bid of $70.01. O E. not win the item Now suppose instead that the auction is a second-price sealed-bid auction. What should you bid if you are the bidder whose valuation is the highest? You should bid S. (Enter a numeric response using an integer.) How does the second-price sealed-bid auction outcome differ from the outcome to the English auction? The outcome to the second-price sealed-bid auction O A. generates less revenue because the amount paid is the bid of the second-highest bidder, which is $70. O B. generates less revenue because the amount paid is the bid of the second-highest bidder, which is $55. OC. is within a dollar or two of being the same because the winner is the individual with the highest bid who pays his or her reservation price, which is $100. OD. is within a dollar or two of being the same because the winner is the individual with the highest bid who pays the reservation price of the second-highest bidder, which is $70 O E. generates more revenue because the winner is the individual with the highest bid who pays his or her reservation price, which is $100.