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sample_questions_part_2

sample_questions_part_2 - Econ 177 Sample Questions Part II...

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Econ 177 Sample Questions Part II 1. Consider a second-price auction with a single private value bidder who value is drawn from the uniform distribution on [0,100]. You are the seller. (a) Compute the optimal reserve price assuming your value for the item is 0. (b) Compute the optimal reserve price assuming your value for the item is 40. (c) Would the reserve prices you calculated in parts (b) and (c) in- crease, decrease, or stay the same if there were 5 bidders with private values that are drawn independently from the uniform distribution on [0,1]. 2. Discuss how the data from our reserve-price experiment compared to the theoretical predictions we derived in class. Consider both initial behavior and learning. Be sure to say something about the saliency of the different treatments and whether this seemed to matter. 3. Consider a common value auction setting where bidder i ’s signal of the value v of the item being auctioned is given by s i = v + e i where e i is a random number drawn from a distribution with zero expected value.
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