... distribution ζ of the I.I.D. endowment variables {Qn} is the two-pointdistributionζ( {1/ 2}) = ζ( {1} ) = 1/ 2,and that the distribution λ of the I.I.D. proportions {Zn} of the total endowment is the ... = 1/ 4.Suppose also that the total bid B is1. Then the price p = B/Q fluctuates betweenp 1 = 1 (when Q = 1) and p2= 2 (when Q = 1/ 2). The modified utility function of (7) isgiven by˜u(b) = 1 2u(b) ... EI (Z), then, by (18 ), we know the function I(·) on the interval [0, 2].Now write ak:= I(2k), k = 0, 1, and, by (18 ), we have the recursionak= 1 +β4ak +1 +3β4ak 1 ,k≥ 1. ( 21) A particular...