This factor contributes to the winner's curse
A)your estimate of the value of the object was not the most optimistic
B)your bid was the highest
C)there were not many other bidders you had to beat out
D)you shaded your bid too much

Question

​This factor contributes to the winner's curse
A)​your estimate of the value of the object was not the most optimistic
B)your bid was the highest
C)there were not many other bidders you had to beat out
D)​you shaded your bid too much

Quizplus · Accepted Answer

The winner's curse occurs when the winner of an auction pays more for the item than it's actually worth. This happens when the winning bid is higher than other bidders' valuations, and the winner overestimates the item's value. Therefore, choice B, where the bid was the highest, is the factor that contributes to the winner's curse.

​This Factor Contributes to the Winner's Curse

This Factor Contributes to the Winner's Curse