Question 1

Which of the following is a similarity between a first-price auction and a Dutch auction?

Accepted Answer

A)  Bids are placed privately. 
B)  Bids are placed publicly. 
C)  Bidders place their bids simultaneously. 
D)  The winner pays an amount equal to his bid. 
A)  Bids are placed privately. 
B)  Bids are placed publicly. 
C)  Bidders place their bids simultaneously. 
D)  The winner pays an amount equal to his bid.

Question 2

Scenario: John, Jacob, Alex, and Maria participate in a first-price auction for an iPod. John values the iPod at $400, Jacob values it at $300, Alex values it at $250, and Maria values it at $200.
-Refer to the scenario above.The seller will earn a revenue of ________.

Accepted Answer

A)  $100 
B)  $300 
C)  $200 
D)  $400 
A)  $100 
B)  $300 
C)  $200 
D)  $400

Question 3

What does the revenue equivalence theorem state?

Accepted Answer

The revenue equivalence theore

Question 4

Scenario: An ancient painting is being auctioned off in an English auction. The following table shows the maximum willingness to pay of each bidder.
  
-Refer to the scenario above.The optimal strategy for Rachel is to bid a price ________.

Accepted Answer

A)  above her willingness to pay 
B)  equal to half the amount she is willing to pay 
C)  equal to 5/6 times her willingness to pay 
D)  up to her willingness to pay 
A)  above her willingness to pay 
B)  equal to half the amount she is willing to pay 
C)  equal to 5/6 times her willingness to pay 
D)  up to her willingness to pay

Question 5

Your friend has just received a new book he ordered,and you want to borrow it.Your friend values reading the book at $10,while you are willing to pay a maximum amount of $15 to read it.
a)What is the equilibrium outcome in this case?
b)Will the outcome be any different if you own a book that your friend wants to read? Assume that the value that each of you places on this book is the same as what you placed on the previous book.

Accepted Answer

a)Because my friend owns the book and va

Question 6

Consider the following situation: five individuals are participating in an auction for an old bicycle used by a famous cyclist.The table below provides the bidders' valuations of the cycle.The auctioneer starts the bid at an offer price far above the bidders' values and lowers the price in increments until one of the bidders accepts the offer.
   
a)What is the optimal strategy of each player in this case?
b)Who will win the auction if each bidder places his or her optimal bid?
c)If Claudia wins the auction,how much surplus will she earn?

Accepted Answer

a)This is an example of a Dutch auction.

Question 7

Explain why the dominant strategy equilibrium in an English auction is also the Nash equilibrium.

Accepted Answer

The dominant strategy equilibrium in an

Question 8

Which of the following is true of a first-price auction?

Accepted Answer

A)  Bidders directly compete with one another. 
B)  Bidders place their bids simultaneously. 
C)  Bidders know one another's bids. 
D)  Bidders always bid below their willingness to pay. 
A)  Bidders directly compete with one another. 
B)  Bidders place their bids simultaneously. 
C)  Bidders know one another's bids. 
D)  Bidders always bid below their willingness to pay.

Question 9

Kim is participating in an auction in which bids are placed publicly and the price of the good being auctioned increases until there is only one standing bid.This is an example of a(n)________ auction.

Accepted Answer

A)  English 
B)  Dutch 
C)  first-price 
D)  second-price 
A)  English 
B)  Dutch 
C)  first-price 
D)  second-price

Question 10

Robert is participating in a Dutch auction.If he values the item being auctioned at $5,500 and there are five bidders in total,what should Robert's optimal bidding strategy be?

Accepted Answer

A Dutch auction is an open-outcry auctio

Question 11

In an auction,________.

Accepted Answer

A)  buyers set the price of a good 
B)  the seller sets the price of a good 
C)  the government sets the price of a good below its market price 
D)  the government sets the price of a good above its market price 
A)  buyers set the price of a good 
B)  the seller sets the price of a good 
C)  the government sets the price of a good below its market price 
D)  the government sets the price of a good above its market price

Question 12

In a Dutch auction,the ________ wins the good.

Accepted Answer

A)  bidder who bids up to his value for the good 
B)  bidder who stops the auction 
C)  bidder with the lowest value for the good 
D)  second bidder 
A)  bidder who bids up to his value for the good 
B)  bidder who stops the auction 
C)  bidder with the lowest value for the good 
D)  second bidder

Question 13

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625.
-Refer to the scenario above.Which of the following is true in this case?

Accepted Answer

A)  There is no Nash equilibrium. 
B)  There is no dominant strategy equilibrium. 
C)  The dominant strategy equilibrium is the Nash equilibrium. 
D)  The dominant strategy equilibrium is not the Nash equilibrium. 
A)  There is no Nash equilibrium. 
B)  There is no dominant strategy equilibrium. 
C)  The dominant strategy equilibrium is the Nash equilibrium. 
D)  The dominant strategy equilibrium is not the Nash equilibrium.

Question 14

Which of the following is a similarity between a second-price auction and an English auction?

Accepted Answer

A)  Bids are placed privately. 
B)  Bids are placed publicly. 
C)  Bidders place their bids simultaneously. 
D)  The winner pays an amount equal to the second-highest bid. 
A)  Bids are placed privately. 
B)  Bids are placed publicly. 
C)  Bidders place their bids simultaneously. 
D)  The winner pays an amount equal to the second-highest bid.

Question 15

What are the different types of auctions based on how people place their bids?

Accepted Answer

There are two different types of auction

Question 16

What is the difference between the two types of sealed bid auctions?

Accepted Answer

The two types of sealed bid auctions are

Question 17

In a Dutch auction,the winner pays a price equal to ________.

Accepted Answer

A)  the market price of the good 
B)  the value of the lowest bid 
C)  her value for the good 
D)  her bid 
A)  the market price of the good 
B)  the value of the lowest bid 
C)  her value for the good 
D)  her bid

Question 18

What is the drawback of a bidder bidding up to his or her willingness to pay for a good in a Dutch auction?

Accepted Answer

A Dutch auction is a descending price au

Question 19

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625.
-Refer to the scenario above.In this case,a Nash equilibrium occurs if ________.

Accepted Answer

A)  each of them bids up to their value for the good 
B)  Tom and Roger bid up to their value for the good while Bill and Jeff bid below their value for the good 
C)  Tom and Jeff bid up to their value for the good while Roger and Bill bid below their value for the good 
D)  Bill and Jeff bid up to their value for the good while Tom and Roger stop bidding at $100 and $200, respectively 
A)  each of them bids up to their value for the good 
B)  Tom and Roger bid up to their value for the good while Bill and Jeff bid below their value for the good 
C)  Tom and Jeff bid up to their value for the good while Roger and Bill bid below their value for the good 
D)  Bill and Jeff bid up to their value for the good while Tom and Roger stop bidding at $100 and $200, respectively

Question 20

Which of the following is a difference between a first-price auction and a Dutch auction?

Accepted Answer

A)  The highest bidder wins in a first-price auction, while the second-highest bidder wins in a Dutch auction. 
B)  The second-highest bidder wins in a first-price auction, while the highest bidder wins in a Dutch auction. 
C)  Bids are placed privately in a first-price auction, while bids are placed publicly in a Dutch auction. 
D)  Bids are placed one after another in a first-price auction, while bids are placed simultaneously in a Dutch auction. 
A)  The highest bidder wins in a first-price auction, while the second-highest bidder wins in a Dutch auction. 
B)  The second-highest bidder wins in a first-price auction, while the highest bidder wins in a Dutch auction. 
C)  Bids are placed privately in a first-price auction, while bids are placed publicly in a Dutch auction. 
D)  Bids are placed one after another in a first-price auction, while bids are placed simultaneously in a Dutch auction.

Which of the following is a similarity between a first-price auction and a Dutch auction?

Scenario: John, Jacob, Alex, and Maria participate in a first-price auction for an iPod. John values the iPod at $400, Jacob values it at $300, Alex values it at $250, and Maria values it at $200. -Refer to the scenario above.The seller will earn a revenue of ________.

What does the revenue equivalence theorem state?

Scenario: An ancient painting is being auctioned off in an English auction. The following table shows the maximum willingness to pay of each bidder. -Refer to the scenario above.The optimal strategy for Rachel is to bid a price ________.

Explain why the dominant strategy equilibrium in an English auction is also the Nash equilibrium.

Which of the following is true of a first-price auction?

Kim is participating in an auction in which bids are placed publicly and the price of the good being auctioned increases until there is only one standing bid.This is an example of a(n)________ auction.

Robert is participating in a Dutch auction.If he values the item being auctioned at $5,500 and there are five bidders in total,what should Robert's optimal bidding strategy be?

In an auction,________.

In a Dutch auction,the ________ wins the good.

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625. -Refer to the scenario above.Which of the following is true in this case?

Which of the following is a similarity between a second-price auction and an English auction?

What are the different types of auctions based on how people place their bids?

What is the difference between the two types of sealed bid auctions?

In a Dutch auction,the winner pays a price equal to ________.

What is the drawback of a bidder bidding up to his or her willingness to pay for a good in a Dutch auction?

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625. -Refer to the scenario above.In this case,a Nash equilibrium occurs if ________.

Which of the following is a difference between a first-price auction and a Dutch auction?

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, supply, and Equilibrium

Consumers and Incentives

Sellers and Incentives

Perfect Competition and the Invisible Hand

Trade

Externalities and Public Goods

The Government in the Economy: Taxation and Regulation

Markets for Factors of Production

Monopoly

Game Theory and Strategic Play

Oligopoly and Monopolistic Competition

Trade-Offs Involving Time and Risk

The Economics of Information

Social Economics

Filters

Exam 17: Auctions and Bargaining

Which of the following is a similarity between a first-price auction and a Dutch auction?

Scenario: John, Jacob, Alex, and Maria participate in a first-price auction for an iPod. John values the iPod at $400, Jacob values it at $300, Alex values it at $250, and Maria values it at $200. -Refer to the scenario above.The seller will earn a revenue of ________.

What does the revenue equivalence theorem state?

Scenario: An ancient painting is being auctioned off in an English auction. The following table shows the maximum willingness to pay of each bidder. -Refer to the scenario above.The optimal strategy for Rachel is to bid a price ________.

Explain why the dominant strategy equilibrium in an English auction is also the Nash equilibrium.

Which of the following is true of a first-price auction?

Kim is participating in an auction in which bids are placed publicly and the price of the good being auctioned increases until there is only one standing bid.This is an example of a(n)________ auction.

Robert is participating in a Dutch auction.If he values the item being auctioned at $5,500 and there are five bidders in total,what should Robert's optimal bidding strategy be?

In an auction,________.

In a Dutch auction,the ________ wins the good.

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625. -Refer to the scenario above.Which of the following is true in this case?

Which of the following is a similarity between a second-price auction and an English auction?

What are the different types of auctions based on how people place their bids?

What is the difference between the two types of sealed bid auctions?

In a Dutch auction,the winner pays a price equal to ________.

What is the drawback of a bidder bidding up to his or her willingness to pay for a good in a Dutch auction?

Scenario: Four friends-Tom, Bill, Jeff, and Roger-are participating in an English auction. Tom values the good being auctioned at $500, Bill values it at $210, Jeff values it at $350, and Roger values it at $625. -Refer to the scenario above.In this case,a Nash equilibrium occurs if ________.

Which of the following is a difference between a first-price auction and a Dutch auction?

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, supply, and Equilibrium

Consumers and Incentives

Sellers and Incentives

Perfect Competition and the Invisible Hand

Trade

Externalities and Public Goods

The Government in the Economy: Taxation and Regulation

Markets for Factors of Production

Monopoly

Game Theory and Strategic Play

Oligopoly and Monopolistic Competition

Trade-Offs Involving Time and Risk

The Economics of Information

Social Economics

Filters