In a Second-Price,sealed-Bid Auction

question 30

Multiple Choice

In a second-price,sealed-bid auction:

• A) buyers bid against each other with a succession of increasingly higher prices until only one remains.
• B) a bid is announced, and if no buyer accepts the bid in a given period of time, a new, slightly lower, bid is announced; this procedure continues until a bidder accepts the announced price.
• C) each bidder submits a price that is known only to that bidder; bids are opened and the highest (lowest) bid is accepted.
• D) each bidder submits a price that is known only to that bidder; bids are opened and the highest (lowest) bidder wins, but the transaction occurs at the second highest (lowest) price.
• E) none of the above.

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Definitions:

Machinery

A category of physical equipment used in the production or manufacturing process.

Indirect Expenses

Costs not directly linked to the production of goods or services, such as office supplies and utility costs.

Benefits Received

A principle that taxes or charges should be levied according to the benefits a taxpayer receives from public expenditures or services.

Department

A distinct area, division, or branch of an organization focused on a specific set of tasks or functions.