What is the Nash Equilibrium in auctions of Swoopo.com?

Swoopo.com is an auction site more in line with a traditional auction house in that the site is the sole seller. The method of auctioning, however, is very interesting. Each bid you place raises the auction price by $0.01 to $0.15 as well as delaying the end time by up to 20 seconds. The catch is, each bid costs you $0.75. It would be interesting to figure out what the optimal strategy for such auctions is.

2 thoughts on “What is the Nash Equilibrium in auctions of Swoopo.com?

  1. Short and yet informative summary about this kind of bidding system. Entertainment shopping with a twist as some people would describe it. Others likes to call it a scam, but remember no one is forced to participate in the bids so be sure to read the mechanics of your bids first.

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