Pennsylvania Auctioneer Practice Exam

What is the term used for the final price of a sold item at auction?

1. Starting price

2. Reserve price

3. Buying price

4. Hammer price

The correct answer is: Hammer price

The term "hammer price" refers to the final price at which an item is sold at auction, which is determined when the auctioneer strikes the hammer to signify that bidding has concluded. This price reflects the highest bid made by a bidder at the auction and is the actual amount that the buyer agrees to pay for the item. Understanding the distinction between "hammer price" and other terms can clarify how auctions function. The starting price is the initial price set for bidding, while the reserve price is the minimum price the seller is willing to accept, which may not be revealed during the auction process. The buying price can be a general term but lacks specificity in the auction context compared to hammer price. Therefore, "hammer price" accurately captures the essence of the final selling value agreed upon by both the seller and the highest bidder.