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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. The auction runs as follows. Both bidders are invited to the same room; 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 andthe two bidders do not need to pay. What should the bidders do? Explain your answer.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).…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.
- Q1 Market-clearing Prices Consider a standard position auction. There are two positions: Top (T) and Bottom (B). Position T receives rT = 150 clicks per day and position B receives TB = 50 clicks per day. There are four bidders (B1-B4) with the following dollar values per click: vị = 8, v2 = 6, v3 = 4, v4 = 2. (a) Find the efficient assignment. (b) Find the lowest per click market-clearing prices. (c) Find the highest per click market-clearing prices. (d) Fully specify and draw the complete set of ALL per click market-clearing prices.Use the expected value information to illustrate how having more bidders in an oral auction will likely result in a higher winning bid.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…
- BET GAME Each player puts an ante of $1 into the pot. There are four kings and four queens. The professor will randomly draw a card from the dealer, privately observe what it is, and decide whether to fold or to bet.< a) If the professor folds, the game ends, and you wins the pot, gaining the professor's $1 ante.< b) If the professor bets, another dollar will be placed in the pot, after which you has the option to either fold or call.< b-1) if you fold, the game is end and you lose you $1 ante.< b-2) if you call, you need to add another $1 to the pot and the professor need to reveal the card. At this stage, there will be $4 in the pot. You win the pot with a queen and lose the pot with a king.< (1) Draw the Game Tree.< (2) Write down the Payoff Matrix. (3) Find the Bayesian Nash Equilibrium (4) Find the Perfect Bayesian Nash Equilibrium.<See attachments for question context. Question: Some people advocated the following modifiction of the auction rule. A bidder cannot bid for only one object, i.e., if at some point in time he withdraws from the bidding race for one object, he automatically withdraws the race for the other object. Every other aspect of the auction, including how prices increase over time, does not change. What should a bidder do if his valuation for the two objects are 50 and 60, respectively? Explain. Does the auction lead to an efficient allocation? Explain.A cool kid is willing to rename himself for a profit. He decides to auction off the naming right. Two bidders show interest. Their valuations for the naming 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…
- At an oral auction for a lamp, half of all bidders have a value of $50 and half have a value of $70. What is the expected winning bid if there are four bidders?Consider 5 bidders whose values are independently and uniformly distributed over [0, 900] (a) For a buyer with value 100, what is his equilibrium bid in a first-price auction (FPA)?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.
