Question

Bob and Tom are graduating and are no longer going to be roommates, but they both want to keep the cat they adopted. Using the Method of Sealed Bids, Bob bids $45 and Tom bids $80 for the cat. Since Tom's bid is higher, he gets the cat. How much will he have to pay Bob in order to keep the division fair

Answer 1

$32.5

Step-by-step explanation:

Bob's first fair share is half of his bid : $45/2 = $22.5

Tom's first fair share is half of his bid : $85/2 = $42.5

Since Tom's bid is higher and he gets the cat, the surplus is therefore : $85 - $22.5-$42.5= $20

Half of the surplus goes to each of them, which is $20/2= $10

So Bob will get in total = $22.5+$10 = $32.5

So Tom will have to pay Bob $32.5 to make it a fair division.