In many sealed-bid auctions, one expects that an increase in the number of bidders will cause each potential buyer to raise his or her equilibrium bid. In some cases, the impact is just the reverse; a buyer is wise to lower his or her bid against a greater number of competitors.

a. Explain why this might be the case.

b. Explain carefully the general result that the seller gains from an increase in the number of bidders. If more numerous bidders cause buyers to lower their bids, how can the seller still gain?