Question
2. (VCG for Position Auctions) Suppose that there are 3 ad slots on the Google search page. The top slot gets 100 clicks per hour,
2. (VCG for Position Auctions) Suppose that there are 3 ad slots on the Google search page. The top slot gets 100 clicks per hour, the middle slot gets 50 clicks per hour, and the bottom slot gets 20 clicks per hour. There are 4 advertisers interested in the ad slots. Google implements the VCG mechanism to sell these slots and asks the advertisers to submit their bids for the amount of money they are willing to pay per click.
Suppose that advertisers 1, 2 and 3 submit the bids $10 per click, $5 per click, $4 per click and $2 per click. How much will each advertiser pay at the end of one hour? How about under GSP?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started