An object is to be auctioned. The only potential bidders are Anna and Bob. Annas value is 24 and Bobs value is 9.5. This information is common knowledge. For questions (a) and (b), suppose that the auctioneer uses a standard sealed-bid second-price auction like the one we studied in class.

(a) Assuming Anna and Bob are cautious, how much would each of them bid?

(b) What would be the amount of money received by the auctioneer?

For questions (c) and (d), suppose the format of the auction is the following. First, Anna submits an integer bid between 0 and 100. Then, after observing Annas bid, Bob submits an integer bid between 0 and 100. The person with the highest bid gets the object and pays his/her bid to the auctioneer. In case of a draw, Bob gets the object.

(c) Use backward induction to solve the game.

(d) What would be the amount of money received by the auctioneer?