You want to enter a fixed first-price auction for inventory across exchanges within Display & Video 360. You're the highest bidder at $10. What will you pay for the impressions?

Analysis of Correct Answer(s)

The correct answer is $10.00. This question tests your understanding of a first-price auction model, which is the standard for most programmatic inventory today.

• In a first-price auction, the highest bidder wins the impression and pays the exact price they bid.
• Since you are the highest bidder with a bid of $10.00, you win the auction and are charged $10.00. The logic is simple: the winning bid equals the clearing price.

Analysis of Incorrect Options

• $10.01: This is incorrect because a bidder never pays more than their actual bid amount.
• $9.99 and $5.00: These answers would be plausible in a second-price auction. In that model, the winner pays $0.01 more than the second-highest bid. For example, if the second-highest bid was $9.98, the winner would pay $9.99. However, the question explicitly specifies a first-price auction, making this logic inapplicable.