A Dutch auction is a type of auction where the
auctioneer begins with a high asking price which is lowered until some
participant is willing to accept the auctioneer's price, or a predetermined
reserve price (the seller's minimum acceptable price) is reached. The winning
participant pays the last announced price. This is also known as a "clock
auction" or an open-outcry descending-price auction.
This type of auction
is convenient when it is important to auction goods quickly, since a sale never
requires more than one bid. Theoretically, the bidding strategy and results of
this auction are equivalent to those in a sealed first-price auction.