Author Question: What is the dominant strategy for a bidder in an English auction? What will be an ideal ... (Read 146 times)

ssal · **on:** Jun 29, 2018

What is the dominant strategy for a bidder in an English auction?

What will be an ideal response?

Question 2

For the recessions in the United States since the 1950s,

A) unemployment falls on average by 2 percentage points during the 12 months after a recession begins.
B) unemployment rises on average about 5 percentage points during the 12 months after a recession begins.
C) cyclical unemployment has been non-existent.
D) unemployment rises on average by about 1.2 percentage points during the 12 months after a recession begins.

ApricotDream · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

Since the bidder pays his bid if he wins, each bidder will continue to raise the bid by the minimum amount allowed until the bidding reaches the value that he places on the item that is being auctioned. This means that, in an English auction, it is a dominant strategy to bid until the price is above the bidder's value for the item.

Answer to Question 2

D