You are developing a bidding strategy for an ascending-price sealed-bid auction of a crude oil field worth

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You are developing a bidding strategy for an ascending-price sealed-bid auction of a crude oil field worth between $1 million and $51 million to the seller. Because your extraction costs are lower, your value is 20 percent greater than the seller’s value. The seller faces transaction costs of conducting the sale and therefore will not accept an offer unless it exceeds her personal value. How much should you bid?

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Managerial economics applications strategy and tactics

ISBN: 978-1439079232

12th Edition

Authors: James r. mcguigan, R. Charles Moyer, frederick h. deb harris

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