The budget runs out
Twenty impressions, real budgets, fresh values each round. One bidder spends until they are broke; the other paces itself and is still bidding at the end.
Run with First-price sealed bid. The link below opens this over repeated rounds, where the bidders adjust as they learn. Here is the first round on its own.
| Bidder | Worth to them | Bid |
|---|---|---|
| A | 70 | 70 |
| B | 70 | 70 |
| C | 70 | 70 |
Step by step
- collect bids Each bidder submits one sealed bid; private values are never revealed.
- sort Bids are ranked from highest to lowest. Equal bids keep the order the bidders were listed in, so a tie goes to the first-listed bidder.
70 >= 70 >= 70
- pick winner The highest eligible bid wins the item. 3 bidders tied at 70; the tie goes to A because they were listed first.
argmax b_i = A at 70
- price rule The winner pays exactly what they bid, so every unit of bid above the runner-up is money left on the table. That is why bidders shade their bids below their true value here, and why the bids you see are not values.
p = b_i = 70
- payments A pays their own bid of 70; the losers pay nothing.
revenue = 70
How it came out
| Winner | A |
|---|---|
| Price paid by the winner | 70 |
| Seller revenue | 70 |
| Value created | 70 |
| Went to whoever valued it most | yes |
| Bidder | Paid | Ended up with |
|---|---|---|
| A | 70 | 0 |
| B | 0 | 0 |
| C | 0 | 0 |
Open this example in the walkthrough
The link carries the whole setup, so you can change a bid and watch what moves — and send the result to somebody else.