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You Are a Bidder in an Independent Private Values Auction

Question 146

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You are a bidder in an independent private values auction.Each bidder perceives that valuations are evenly distributed between $100 and $1,000.If there is a total of three bidders and your own valuation of the item is $900,what is your optimal bidding strategy in:
a.A first-price,sealed-bid auction?
b.A Dutch auction?
c.A second-price,sealed-bid auction?
d.An English auction?

Correct Answer:

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a.With three bidders,n = 3.The lowest po...

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