Question: plz help me this question Consider a sealed-bid second price auction with three bidders. The seller has a value 0 for the object. Each bidder
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Consider a sealed-bid second price auction with three bidders. The seller has a value 0 for the object. Each bidder has a value drawn from the uniform distribution F (1)) = 'u on [0, 1], i.e., the probability that his value is less than a: is just :12. Consider a third-price auction with n > 3 bidders (the highest bidder wins but pays a price equal to the third-highest bid). a. Assume that the equilibrium function is increasing in the bidders value. Intuitively try to reason out how the equilibrium bid ,6(v) should relate to o. Is it equal to v, greater, or less? b. Use the Revenue Equivalence Principle to nd the equilibrium bidding function
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