This is a multi-player game, with one player playing an auctioneer role and the remaining players as bidding advertisers
Each bidder submits their bid for an ad display on the popular Steaming Panda Spa website without knowing the bids of others
The game ends when one of the following happens:
All bidders have submitted their bids
Time runs out
How to Play
As a bidder your screen displays:
Your own value, the type of auction and whether there is a reserve price set for the auction
Slider to choose the bid and button to submit
A notification whether or not you have won the auction and what price you would need to pay for the ad display
As an auctioneer your screen displays:
What type of auction you are running and how many bidders are in the auction
“Start Auction” button
Optionally, auctioneers may have the flexibility to change the pricing rule between First Price and Second Price (the latter means the winner would only need to pay the 2nd highest price)
Optionally, auctioneers may have the flexibility to set a non-zero reserve price
Payoff Computation
Bidder
Winning Bidder payoff: Value − Winning Bid
Non-Winning Bidder payoff: 0
Auctioneer
Winning bid
Otherwise, 0
Winning price calculation
1st price auction: if highest bid is >= reserve price, winning price = highest bid
2nd price auction:
If highest bid is >= reserve price and 2nd highest bid < reserve price, winning price = reserve price