Problem 3. [Auctions] Mark and Lisa want to buy a house in Amsterdam. They decide to try their luck at an auction run by a local real estate rm. As the real estate market in Amsterdam is competitive, the auction is well attended by potential buyers. The real estate rm receives a commission that accounts to 5% of the price of the house. There are two auction types that the real estate rm is considering, a sealed bid rst or second price auction. (a) (5 points) What is the most benecial auction for the real estate rm? Explain why an|d link your answer to the optimal bidding strategy. (b) (5 points) Suppose that Mark and Lisa have the highest valuation for the house on auction out of all the bidders. What can you say about their optimal bidding strategies7 depending on the type of auction chosen by the real estate rm