Two players participate in a first-price sealed-bid auction in an IPV setting. The value of the good for each player is given by 0.5+?i ,where ?i is observed only by player i and is uniformly distributed over the interval [0, 1]. Show that there is a symmetric Bayesian Nash equilibrium in which each bidder i's bidding strategy is of the form ?(?i)=a+b?i. What is the expected payoff of a player if his type is ?i?

Two players participate in a first-price sealed-bid auction in an IPV setting. The value of the good for each player is given by 0.5+0 , where ; is observed only by player i and is uniformly distributed over the interval 0, 1). Show that there is a symmetric Bayesian Nash equilibrium in which each bidder i's bidding strategy is of the form (0;) = a + be;. What is the expected payoff of a player if his type is 0;? [05 + 05 = 10]