CHAPTER 18 1) An oral auction a) is also called an English auction b) is where bidders submit increasing bids until all but one remains c) is where the sole remaining bidder wins and pays his winning ...

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CHAPTER 18
1)
An oral auction
a)
is also called an English auction
b)
is where bidders submit increasing bids until all but one remains
c)
is where the sole remaining bidder wins and pays his winning bid
d)
all of the above
ANS: D
2)
A second-price auction
a)
is also called a Vickrey auction
b)
is conducted by bidders submitting a single sealed bid
c)
is where the highest bidder wins and pays the amount of the next highest bid
d)
all of the above
ANS: D
3)
An oral auction
a)
is also called a Vickrey auction
b)
is where bidders submit increasing bids until all but one remains
c)
is where the highest bidder wins and pays the amount of the next highest bid
d)
all of the above
ANS: B
4)
A second-price auction
a)
is also called an English auction
b)
is where the highest bidder wins and pays the amount of the next highest bid
c)
is where the sole remaining bidder wins and pays his winning bid
d)
all of the above
ANS: B

5)
An oral auction
a)
is also called a Vickrey auction
b)
is conducted by bidders submitting a single sealed bid
c)
is where the sole remaining bidder wins and pays his winning bid
d)
all of the above
ANS: C
6)
A second-price auction
a)
is also called a Vickrey auction
b)
is where bidders submit increasing bids until all but one remains
c)
is where the sole remaining bidder wins and pays his winning bid
d)
all of the above
ANS: A
7)
The optimal bidding strategy for an oral auction is
a)
To shade your bid below your true value and drop out well before it is reached
b) To shade your bid below your true value and drop out just when the shaded
amount is reached
c)
To bid drop out when the bidding exceeds your true value
d)
To size up your competition to determine how much to shade your bid
ANS: C
8)
The optimal bidding strategy for a second-price auction is
a)
To bid your true value
b)
To shade your bid well below your true value
c)
To shade your bid just a little below your true value
d)
To size up your competition to determine how much to shade your bid
ANS: A
9) If the bidders at an oral auction have true values of $8, $7, $6, and $5, the item will
sell for

a)
$8
b)
$7
c)
just over $7
d)
just under $7
ANS: C
10) If the bidders at a second-price auction have true values of $8, $7, $6, and $5, the item
will sell for
a)
$8
b)
$7
c)
just over $7
d)
just under $7
ANS: B
11) If the bidders at an oral auction have true values of $78, $72, $66, and $65, the item
will sell for
a)
$78
b)
just under $78
c)
$72
d)
just over $72
ANS: D
12) If the bidders at a second-price auction have true values of $78, $72, $66, and $65, the
item will sell for
a)
$78
b)
just under $78
c)
$72
d)
just over $72
ANS: C
13)
The more bidders there are at an oral auction,
a)
the higher the expected selling price

b)
the higher each bidder bids
c)
the longer that each bidder will continue to bid
d)
the less each bidder will shade his bid
ANS: A
14)
The more bidders there are at a second-price auction,
a)
the higher the expected selling price
b)
the higher