Explain that pay-per-click bids form a nash equilibrium

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Reference no: EM133614196

Problem: Keyword auction) A search engine has two ad positions to sell, and the positions receive 300, and 100 clicks per hour. Three advertisers (A, B, and C) value each click by $12, $11, and $3, respectively. Suppose that the search engine runs the generalized second-price auction. Explain that pay-per-click bids (bA, bB , bC ) = ($11, $5, $2) form a Nash equilibrium. Is the Nash equilibrium envy-free, or not? Explain.

Reference no: EM133614196

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