Auctioneer Practice Exam

What is a shill in the context of auctioneering?

1. A legal technique to encourage bidders

2. A person who runs up bids to a predetermined amount

3. An auctioneer's assistant showing the merchandise

4. A strategy to lower prices for bidders

The correct answer is: A person who runs up bids to a predetermined amount

In the context of auctioneering, a shill refers to a person who artificially inflates the bidding by placing bids on an item themselves, often in collusion with the seller or the auctioneer. This practice is intended to create the illusion of higher demand or interest in the item, which may encourage other legitimate bidders to participate or raise their bids, ultimately driving the selling price higher. The chosen option accurately captures this concept, as shilling typically involves running up bids to a predetermined amount, benefiting the seller at the expense of fair competitive bidding practices. This behavior is generally considered unethical and can undermine the integrity of the auction process. Other options, while related to auction practices, do not encapsulate the specific definition of shill effectively. For instance, a legal technique for encouraging bidders does not reflect the deceptive nature of shilling. Similarly, the role of an auctioneer's assistant is to support the auction process, not to manipulate bids. Lastly, a strategy for lowering prices for bidders contradicts the fundamental goal of shilling, which is to increase bids rather than decrease them.