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Unformatted text preview: b. Bid above their true valuations. c. Shade their bids below their true valuations. d. Bid the valuation of the second highest bidder. 4. Suppose you are auctioning off an item and you fear collusion between the bidders at the auction. If this was the case, you would be better off using a: a. First price sealed bid or Dutch auction. b. Second price sealed bid or English auction. c. First price sealed bid or English auction. d. Second price sealed bid or Dutch auction. 5. We showed in class that under certain circumstances, if a first- price sealed bid auction design is used, bidders have a Nash equilibrium strategy of bidding exactly half of their true valuation. What is a Nash equilibrium?...
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- Spring '06