In a common value auction, you can get an unbiased estimate of the true value of a good by estimating the ____________ of the uniform distribution of estimates.

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Quizplus · Accepted Answer

In a common value auction, all bidders have the same information about the value of the good, and their private valuations are drawn from a common distribution. The mean of this distribution represents the unbiased estimate of the true value of the good, making choice B, mean, the best choice. The median would not be as accurate in this case because it does not take into account the entire distribution of estimates, only the middle value. The variance is a measure of how spread out the estimates are, but it does not give an estimate of the true value.

In a Common Value Auction, You Can Get an Unbiased