As a manager holding an auction with correlated or common values, you want buyers to place bids that are _______ their estimated valuations and sellers to place bids that are________ their estimated costs.

Question

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In an auction with correlated or common values, buyers and sellers share similar information about the item being auctioned. As a result, bids are more likely to converge towards the true value of the item. As a manager, you want buyers to place bids that are close to their estimated valuations and sellers to place bids that are also close to their estimated costs. This will ensure that the auction results in a fair price that reflects the true value of the item being sold. Bids that are far from the estimated valuation or cost are less likely to accurately reflect the true value and may result in an unfair outcome for either the buyer or seller.

As a Manager Holding an Auction with Correlated or Common