Suppose there are three bidders with values for the object that are independent, private and uniformly distributed over [0, 1]. a) Derive the seller's expected revenue in a second-price auction. Fully explain your answer. b) Derive the seller's expected revenue in a first-price auction. Fully explain your answer. c) Explain why the answers to parts (a) and (b) are the same. d) Show that the answers to parts (a) and (b) remain the same when there are N bidders. Fully explain your answer.

Suppose there are three bidders with values for the object that are independent, private and uniformly distributed over [0, 1]. a) Derive the seller's expected revenue in a second-price auction. Fully explain your answer. b) Derive the seller's expected revenue in a first-price auction. Fully explain your answer. c) Explain why the answers to parts (a) and (b) are the same. d) Show that the answers to parts (a) and (b) remain the same when there are N bidders. Fully explain your answer.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter18: Asymmetric Information

Section: Chapter Questions

Problem 18.10P

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