Analysis of Bid Strategy with Game Theory in Auctions with a Buyout price

The unprecedented growth of Internet has deeply infiltrated all of today´s society. With more and more people using the Internet for a wide range of purposes, Internet use has become an absolute necessity for businesses to survive and grow. Online auction has been a particularly effective form of electronic commerce and is a promising field. Online auction often enable sellers to augment their auctions with a buyout price. The strategy of bidder is very important and has effect on seller´s choice of auction form. Recent theoretical research shows the benefits of English auction with buyout price. In this paper we will show the bidder´s strategy on eBay buy-it-now auction with game theory. There is an equilibrium which is the optimal for any first bidder.