BRIEFLY answer EACH of the following questions. No diagrams/math necessary.

a. Why is it the case that in a sequential 2nd price auction bidders shade their bids in all but the last round?

b. What is a jump bid? Explain the logic behind it.

c. What is the linkage principle?

d. Leakage is a problem for an auction ring when, in an attempt to depress the price in the actual auction, an outsider (not part of the ring) is able to win the item in the actual auction even though the same bid would not have won the rings knockout auction. For what type of auction formats do rings have to worry about leakage? Why? Note: you may assume a private value auction for all parts of the question.