3 Q2GSP vs. VickreyConsider a standard position auction. There are three positions: Top (T), Middle (M) andBottom (B). Position T receives xT =position B receives xBdollar values per click: v1150 clicks per day, position M receives xM =100 and50 clicks per day. There are five bidders (B1-B5) with the following12, v2 = 10, v3 = 7, v4 = 5, v5 = 3.%D(a) Verify whether bidding your value will be an equilibrium of the GSP auction (Google).(b) Find an equilibrium of the GSP auction (Google) with the maximum revenue.(c) Find an equilibrium of the GSP auction (Google) with the minimum revenue.(d) Find the equilibrium of the Vickrey auction (Facebook). Calculate auction revenue.

*Answer: Second Price Auction Second Price Auction is the auction in which the highest bidder wins…

(B). Position T receives rT = 150 clicks per day, positio n B receives xB = 50 clicks per day. There are five bidders ralues per click: vị = 12, v2 = 10, v3 = 7, v4 = 5, v5 = 3. - %3D |3| erify whether bidding your value will be an equilibrium of t ind an equilibrium of the GSP auction (Google) with the m ind an equilibrium of the GSP auction (Google) with the m ind the equilibrium of the Vickrey auction (Facebook). Cale

(B). Position T receives rT = 150 clicks per day, positio n B receives xB = 50 clicks per day. There are five bidders ralues per click: vị = 12, v2 = 10, v3 = 7, v4 = 5, v5 = 3. - %3D |3| erify whether bidding your value will be an equilibrium of t ind an equilibrium of the GSP auction (Google) with the m ind an equilibrium of the GSP auction (Google) with the m ind the equilibrium of the Vickrey auction (Facebook). Cale

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter17: Making Decisions With Uncertainty

Section: Chapter Questions

Problem 17.5IP

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