Suppose that Alpha Inc, Richardson Industries, and K-Tek are the only three firms interested in a plot of land on the outskirts of town. The lot is being auctioned by a second-price sealed bid auction Alpha values the lot at $16,500, Richardson at $18,000, and K-Tek at $12.500 Each bidding firm's consumer surplus is CS--P it wins the auction and 0 af it loses. The values are private. What is each bidder's optimal bid? Who wins the auction, and what price does that firm pay? Alpha's optimal bid is $. Richardson's optimal bid is S and K-Tek's is (Enter your responses as whole numbers)

Suppose that Alpha Inc, Richardson Industries, and K-Tek are the only three firms interested in a plot of land on the outskirts of town. The lot is being auctioned by a second-price sealed bid auction Alpha values the lot at $16,500, Richardson at $18,000, and K-Tek at $12.500 Each bidding firm's consumer surplus is CS--P it wins the auction and 0 af it loses. The values are private. What is each bidder's optimal bid? Who wins the auction, and what price does that firm pay? Alpha's optimal bid is $. Richardson's optimal bid is S and K-Tek's is (Enter your responses as whole numbers)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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