![]() Does the probability of JC winning increase or decrease? Does the expected payment from the government increase or decrease? c. Suppose that one more bidder joins the auction. What is JC's bid? What is the probability of JC's winning? b. Suppose the true cost of Japan Construction (JC), a bidder, is 60. In the following questions, consider this unique equilibrium. There is a unique equilibrium in the bidders' game. Suppose that the true cost is distributed uniformly between 0 and 200, independently across all the bidders. Each bidder's payoff is zero if she loses, and the payoff is the bid minus the true cost if she wins. If there are multiple lowest bids, then one of them is randomly chosen with equal probability. The bidder with the lowest bid wins the auction and receives its own bid. 2 1 Auction Consider a government running a procurement auction in which bidders bid their costs. ![]()
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