I have a one dollar bill. there is a crowd of people around me. I hold it up and say that i will auction the one dollar bill off, and the dollar would go to the highest bidder.
The catch? the first AND second highest bidder both have to pay me whatever they bid. For example, if the bidding stops when someone bids 1.00 and the next person bids .95, then I get 1.95, and the winner gets nothing, the second person loses 95 cents.
What would you do if you were at this auction, and there had to be at least one bid? What is the "winning" strategy, assuming that everyone will want to do what is best for them?
|
|
Submitted by Jonathan Waltz
|
|
Rating: 3.9474 (19 votes)
|
|
|
Solution:
|
(Hide)
|
|
Well, the only possibility is for the first person to bid one dollar. if i bid first, and bid on cent, then there will be someone who thinks that he can get it for two cents, so he will bid two. Well, i dont want to pay one cent and get nothing out of it, so i bid three cents.
This would go on and on, until the numbers get ridiculously huge, making the auctioneer incredibly rich. but, if the first person bids one dollar, then noone would want to bid higher than that, because they aren't paying any money, and because who would want to pay more than a dollar for a plain one dollar bill? |
