CFA Level I · CFA Level I Exam · Fixed-Income Markets for Government Issuers
In a single-price (uniform-price) Treasury auction, successful bidders most likely pay:
In a single-price auction, every successful bidder pays the same price, determined by the stop-out yield, the highest accepted yield that clears the offering. Paying one's own bid describes a multiple-price auction, where winning bidders pay different prices.
- Athe price they individually bid
- Bthe same price, set at the stop-out (lowest accepted) yieldCorrect
- Cthe average of all bids submitted
Explanation
In a single-price auction, all successful bidders receive securities at the same price, which corresponds to the stop-out yield (the highest yield accepted). Paying one's own bid is the multiple-price (discriminatory) format. No auction format uses the average of all bids.
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