A First-Price Auction is a bidding process where participants submit their bids without knowing what others are offering. The highest bidder wins the item and pays the amount they bid. This type of auction encourages bidders to carefully consider their offers, as they must balance the desire to win with the need to pay a reasonable price. In a First-Price Auction, bidders often strategize by estimating how much others might bid. This can lead to competitive bidding, where participants may bid higher than they initially planned. Understanding this auction format is essential for anyone involved in buying or selling items, such as art, real estate, or collectibles.