Consider participating in a sealed-bid second price auction

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Assume you consider participating in a sealed-bid second price auction for a vintage car in which the winner of the auction (the bidder who submits the highest bid) only has to pay the second highest bid that was submitted. Also, assume you value the car that is being auctioned at $30,000. Explain carefully why submitting any bid lower than $30,000 is dominated by submitting a bid of $30,000. What type of domination is this?

Reference no: EM13774318

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