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Auction
and Its Benefits
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by:
S.M
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An
auction is basically a public sale wherein any object is sold to the
highest bidder. It can be defined as a process of purchasing and
selling things by offering them up for bid, taking bids and selling the
things out to the highest bidder. This is what is generally the case.
However, a sale to the lowest bidder may also take place, in cases
where land is sold for non-payment of taxes to anyone willing to take
it for the shortest term; or where a contract is offered to an
individual or party willing to take it for the shortest term; or where
a contract is offered to an individual or party willing to perform it
at the lowest price. Such cases too seem to fairly come under the
purview of the term ‘auction’.
In case of auction the seller presents the products on a public
platform. The selling price of the products are
determined by the bids or offers of buyers interested in buying them
based on their individual estimation of value of and need of the
products. The person offering the highest bid at closing of auction
receives the right to purchase the products at the bid price. The
winner of the bid is normally legally bound to buy the item auctioned.
In recent times auctions have been conducted online.
The benefits of auction are many. Some of the significant advantages
are:
a)The auctioned item fetches the highest price in the given situation.
Thus, in a way there is the maximization or optimization of profit.
b)At an auction the goods are almost certainly disposed off after
bidding by their sale to the highest bidder. Hence, this serves as the
right podium for disposing or selling out
of accumulated goods. Otherwise, business could have become stagnant
due to the stocking of these goods. Certain items could also have
perished (in case of perishable goods) or expired if not sold out in
time.
c)In case of auctioning a variety of articles may come up for sale,
which may not be otherwise available in the market. The buyer can get
quite urprised by looking at a treasure trove of antique articles
available at an auction.
d)An auction can also be considered as a method for estimating the
value of certain commodities which have hitherto undetermined or
variable prices.
About the Author
Author bio:
Author: S.M
http://www.autocastle.com/
http://www.autocastle.com/dealers.asp
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