In a reserve auction, what is the minimum sales price known as?

In a reserve auction, what is the minimum sales price known as?

• A. Base price
• B. Confidential figure
• C. Reserve price
• D. Starting bid

Answer: (C)

In a reserve auction, the minimum sales price that the seller is willing to accept is known as the reserve price. This price is not disclosed to bidders and serves as a safeguard for the seller, allowing them to reject any bids that fall below this predetermined threshold. The reserve price ensures that the seller has a level of control over the transaction, helping to avoid situations where the auction concludes without reaching a satisfactory price. The reserve price is distinct from terms like starting bid, which is the initial bid that participants must meet or exceed to engage in the auction process. In contrast, the base price and confidential figure do not specifically define this minimum sales threshold used in reserve auctions, highlighting the unique function of the reserve price within the auction framework.

In a reserve auction, the minimum sales price that the seller is willing to accept is known as the reserve price. This price is not disclosed to bidders and serves as a safeguard for the seller, allowing them to reject any bids that fall below this predetermined threshold. The reserve price ensures that the seller has a level of control over the transaction, helping to avoid situations where the auction concludes without reaching a satisfactory price.

The reserve price is distinct from terms like starting bid, which is the initial bid that participants must meet or exceed to engage in the auction process. In contrast, the base price and confidential figure do not specifically define this minimum sales threshold used in reserve auctions, highlighting the unique function of the reserve price within the auction framework.