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Two collectors A and B have told their respective agents C and D that they would pay $700 and$750, respectively, for a rare coin which
Two collectors A and B have told their respective agents C and D that they would pay $700 and$750, respectively, for a rare coin which is now available for sale. Each agent needs to make a bid to the seller. The seller needs to choose a rule to determine the winning agent and price based on the bids, so as to maximize her/his revenue from the sale. If an agent wins the coin, she/he will sell the coin to her/his collector at the agreed price, and keep any profit fro her/himself. Each agent wants to maximize her/his profit. Suppose the seller chooses the following rule : The higher bid wins the coin, and the bidder needs today the average of the two bids for the coin. Suppose C and D bids $640 and $600 respective. what is C's payoff
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