There are four bidders. Their valuations are commonly known to be in between 200 and 600, equally likely. Every bidder knows his/her valuation but does not know the valuations of the others. The actual valuations are: V₁ - 400 V2-480 V3-520 V4-560 The seller in the equilibrium of a first price auction obtains an expected payoff of: 450 b-470 0.500 d. 480 e. None of the above
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- A cool kid is willing to rename himself for a profit. He decides to auctionoff the naming right. Two bidders show interest. Their valuations for thenaming right are independently and uniformly distributed over [0,100].There are several possible ideas to design the auction.(a) The auction runs as follows. Both bidders are invited to the sameroom; an auctioneer will start the auction with an initial price 0, and increase it by $1 every minute. The bidders are not allowed to say anything during the process, but they can walk out of the room at any moment. If one bidder walks out of the room when the price increases to p (the bidder does not need to pay), the remaining bidder will be awarded the naming right for a price of p. If both walk out when the price reaches p, the naming right is not assigned and the two bidders do not need to pay. What should the bidders do? Explain your answer. (b) Both bidders are invited to submit their bids covertly (bids are non-negative real…4. A uniform price auction is an auction where all the winners pay the same price. A k-th price auction is an auction where the price paid by the winner(s) is the k-th highest bid. We run a 3rd price, uniform price auction for two items, so the winners are the two bidders with the highest bid. There are 4 bidders, A, B, C and D, and they bid respectively $10, $9, $8 and $12. (A) Bidders A and B win the auction and pay $9. (B) Bidders A and D win the auction and pay $9. (C) Bidders B and D win the auction and pay $10. (D) Bidders B and C win the auction and pay $8.A cool kid is willing to rename himself for a profit. He decides to auctionoff the naming right. Two bidders show interest. Their valuations for thenaming right are independently and uniformly distributed over [0;100]:There are several possible ideas to design the auction. The auction runs as follows. Both bidders are invited to the sameroom; an auctioneer will start the auction with an initial price 0 and increase it by $1 every minute. The bidders are not allowed to say anything during the process, but they can walk out of the room at any moment. If one bidder walks out of the room when the price increases to p(the bidder does not need to pay), the remaining bidder will be awarded the naming right for a price of p. If both walk out when the price reaches p, the naming right is not assigned and the two bidders do not need to pay. What should the bidders do? Explain your answer.
- Question 1 Consider a first-price sealed bid auction of a single object with two biddersj = 1,2 and no reservation price. Bidder 1′s valuation is v1 = 2, and bidder 2′s valuation isv1 = 5. Both v1 and v2 are known to both bidders. Bids must be in whole dollar amounts.In the event of a tie, the object is awarded by a flip of a fair coin.(a) Find an equilibrium of this game.(b) Is the allocation of your answer to (a) efficient?A cool kid is willing to rename himself for a profit. He decides to auctionoff the naming right. Two bidders show interest. Their valuations for thenaming right are independently and uniformly distributed over [0,100].There are several possible ideas to design the auction. a) The auction runs as follows. Both bidders are invited to the sameroom; an auctioneer will start the auction with an initial price 0, and increase it by $1 every minute. The bidders are not allowed to say anything during the process, but they can walk out of the room at any moment. If one bidder walks out of the room when the price increases to p (the bidder does not need to pay), the remaining bidder will be awarded the naming right for a price of p. If both walk out when the price reaches p, the naming right is not assigned and the two bidders do not need to pay. What should the bidders do? Explain your answer. (b) Both bidders are invited to submit their bids covertly (bids are non-negative real numbers).…Eunice, the industry analyst of H&M, wants to determine the propensity of Major Clothingcompanies toward risk. She was able to determine the utility distribution of H&M, Uniqloand Dickies. For H&M, If the expected payoff of a venture is a loss of 125,000, the utilityvalue is 0.00, if a loss of 75,000, the utility value is .2, if breakeven, the utility value is .5,if gain of 75,000 .8 and if gain of 125,000 utility value is 1. For Uniqlo, if loss of 125,000utility value is 0, if loss of 75,000 utility value is .1, breakeven is .4, if a gain of 75,000,utility value is .7 and if gain of 125,000 utility value is 1. For Dickies, if loss of 125,000,utility value is 0, if loss of 75,000, utility value is .3 breakeven is .6, if gain of 75,000, utilityvalue is .9 and gain of 125,000, utility value is 1. What is the propensity to risk of the threeinternet companies? Explain your graph.
- 1. A dealer decides to sell a rare book by means of an English auction with a reservation price of 54. There are two bidders. The dealer believes that there are only three possible values, 90, 54, and 45, that each bidder’s willingness to pay might take. Each bidder has a probability of 1/3 of having each of these willingnesses to pay, and the probabilities for each of the two bidders are independent of the other’s valuation. Assuming that the two bidders bid rationally and do not collude, the dealer’s expected revenue is approximately ______. 2. A seller knows that there are two bidders for the object he is selling. He believes that with probability 1/2, one has a buyer value of 5 and the other has a buyer value of 10 and with probability 1/2, one has a buyer value of 8 and the other has a buyer value of 15. He knows that bidders will want to buy the object so long as they can get it for their buyer value or less. He sells it in an English auction with a reserve price which he must…5. Shift-in-charge Nazar Al Rushdy: Nazar is pessimistic about the market price. What is your guidance for Nazar? The decision to employ decision trees in crucial situations has been taken by Salem Al Harthi, the plant manager. The table below presents data on demand for a duration of 6 hours along with their respective probabilities. The first row of the table provides the probability of demand for the initial three hours when a leak occurs, denoted in parentheses. Subsequently, the following three rows indicate the probabilities of high, medium, and low demand for the succeeding three hours. To illustrate, if the initial 3-hour market price was low, the probabilities of high demand, medium demand, and low demand in the next three hours are 0.2, 0.3, and 0.5, respectively. Market price High Market price Medium Initial 3-hrs (0.2) Initial 3-hrs (0.5) Market price Low Initial 3-hrs (0.3) High demand (next (0.5) (0.4) (0.2) 3 hrs) Medium demand (0.3) (0.2) (0.3) (next 3 hours) Low demand…There are 4 bidders with valuations that are independently and uniformly distributed between 0 and 1. In equilibrium, what is the probability that the highest bid is less than 0.2 in a first-price auction? Round your answer to two decimal places.
- Please no written by hand A reserve price is a minimum price set by the auctioneer. If no bidder is willing to pay the reserve price, the item is unsold at a profit of $0 for the auctioneer. If only one bidder values the item at or above the reserve price, that bidder pays the reserve price. An auctioneer faces two bidders, each with a value of either $186 or $248, with both values equally probable. Without a reserve price, the second highest bid will be the price paid by the winning bidder. The following table lists the four possible combinations for bidder values. Each combination is equally likely to occur.Assume you are one of the two bidders in a second-price sealed bid auction for a preserved grilled cheese sandwich which purportedly bore the portrait of the Virgin Mary: • This sandwich is worth $8000 to you. • You know that your rival bidder’s valuation is uniformly distributed between $0 and $12,000. a) What is the probability that your bid exceeds your rival’s bid given that you know your rival’s valuation is uniformly distributed between $0 and $12,000? (In other words, what is the probability that your rival’s bid is lower than your valuation?) Remember the equilibrium bidding strategies for a SPA in weakly dominant strategies ! b) What is your rival’s average bid, if you win the auction (considering that he must have bid below your bid)? c) What is your expected payoff from this auction, if you win the bidding ? (Hint: Combine b) and c), i.e. compute the payoff from winning giving the probability of winning)please solve it in 30 minute please Consider an infinitely repeated game where the stage game is the game of chicken: Swerve Straight Swerve 0,0 -1,1 Straight 1, –1 -10, -10 Assume that the discount factor is very close to one. For concreteness, you can assume that d = 0.99. (a) Is there an SPE in which player l's payoff is 1/(1 – 6)? Explain. (b) Is there an SPE in which each player gets a payoff of 0? Explain. (c) Is there an SPE in which player l's payoff is -2/(1 – 8)? Explain.
