Inspired by Che (1993)1 the Dutch government will conduct a scoring auction for paving a new bike path in Utrecht. The government solicits bids from two firms. Each bid specifies an offer of promised quality, q and price, p, at which a fixed quantity of products with the offered level of quality q is delivered. The quantity is normalised to one (i.e one bike path). For simplicity quality is modelled as a one-dimensional attribute, for example quality ofthe asphalt. Assume that the scoring rule is defined by S(q,p) = 10 p. Firm A bids a quality valuated in 7 units and a price of 5 thousand euros and Firm B bids a quality of 5 and a price of 3 thousand euros. a- Describe how would a first-score auction and a second-score auction work. (3 points) b- Find the scores for Firm A and Firm B and discuss who would win in first-score auction and who would win a second-score auction. Discuss your findings in line with the lecture on supplier selection (Schotanus Lecture 2022). (7 points)