Sealed-bid auction
The winner of an auction for something of uncertain value is usually the one who overestimated it.
5 minutes · trains Value and bid · points only, never money
Five jars of coins come up for auction, one at a time. You and four bots each make one sealed bid on each jar, from a rough estimate of what it holds. Try to end with more points than you started with.
- Jar
- 0 of 5
- Your points
- 0
- Bots' points
- 0
Each jar of coins is worth the same to every bidder, somewhere from 40 to 160 points. Nobody knows exactly how much.
You and four bots each get an estimate, within 30 points of the true value either way. Everyone makes one sealed bid. The highest bid wins and pays what it bid, so the winner's profit is the jar's value minus the bid. It can be negative.
Try it yourself
Five bidders estimate a jar of coins that is worth the same to all of them. Each estimate is off by up to 30 points. If everyone bids their estimate, who usually wins?
3 questions, a minute or two. Nothing to finish first.
Want more? Practise Value and bid.
Read more
- Winner's curse In an auction for something of uncertain value, the winner tends to be the one who overestimated it most.
- Don't overpay to win When many people bid on something uncertain, the winner is often the one who overestimated it.
- The Value and bid course Lessons and practice for the skill this lab trains.