In a second-price auction for inventory within Display & Video 360, if you’re the highest bidder at $10 and the second-highest bid is $6, you will pay $6.01 for these impressions.
- $10.01
- $10.00
- $6.00
- $6.01
The correct answer is: $6.01
Explanation: A second-price auction model ensures that the winning bidder pays just one cent more than the second-highest bid. This structure encourages participants to bid their true valuation for the impressions, providing a fair competitive advantage without overpaying. In this scenario, your winning bid of $10 results in a payment of $6.01, slightly above the second-highest bid, optimizing cost-efficiency for acquiring the desired impressions.
Chapter 21: Understand Auction Dynamics