Firm Z Is One of the 5 Bidders, Each with a Value

Multiple Choice

Firm Z is one of the 5 bidders, each with a value independently drawn from the range $100,000 to $160,000 with all values in between being equally likely. In a sealed-bid auction, Firm Z's equilibrium bidding strategy is:

A) b_i = (.2) (160,000) + .8v_i
B) b_i = (.5) (160,000) + .5v_i
C) b_i = (.25) (100,000) + .75v_i
D) b_i = (.2) (100,000) + .8v_i
E) b_i = (.8) (100,000) + .2v_i