Auctions can be an important tool for selling goods and gathering information. A
Auctions can be an important tool for selling goods and gathering information. Auctions are used in multiple venues including agriculture eBay and distressed asset sales. The seller does not have to worry about estimating demand and setting a price because the demanders will do that through the auction process. Describe the value of auctions in the economy by addressing the following items. Explain the difference between oral auctions and second-price auctions including how they work and their results. Use the expected value information to illustrate how having more bidders in an oral auction will likely result in a higher winning bid. Explain how the number of bidders in a common value auction affects the outcome of the auction. Relate this to the effect on price in different market structures based on the number of producers. Auctions lead to outcomes where buyers reveal their value for the products being auctioned. To successfully price discriminate firms often rely on buyers revealing their value for products. Explain the conditions necessary for firms to be able to price discriminate. Must be at least three pages in length (not counting the title and references pages) and include at least three peer-reviewed resources. Adhere to APA Style including citations and references for sources used. Be sure to include an introduction. Please note that no abstract is needed. Additional Details on the grading Response reflects indepth consideration and personalization of the theories concepts and/or strategies presented. Viewpoints and interpretations are insightful. Response demonstrates synthesis of ideas presented.