Which of the following is true about bids in an absolute auction?

In an absolute auction, every bid made is binding and represents a genuine intention by the bidder to purchase the item at the price offered. This means that once a bidder places a bid, they are committed to their offer and cannot retract it without consequences. Absolute auctions are characterized by the auctioneer's commitment to selling the item to the highest bidder, regardless of the final bid amount.

This aspect ensures that bidders can feel confident that the auction will conclude with a sale to the highest bidder without the uncertainty of a reserve price or minimum threshold that may not be met. Thus, the binding nature of bids in an absolute auction adds transparency and finality to the auction process, benefiting both sellers and buyers in their transaction.