Many feel that Penny Auctions could possibly be a scam, but I do not believe they are and as long as they tell the truth and completely disclose everything than you are safe. Below we found this outline on another site of how a penny auction website workds and we want to share it with you:
1. A product, such as a laptop, is put up for auction starting at $0.01
2. Penny auctions are auctions where you buy your bids, and as you bid the price goes up by a set increment (usually a penny) and more time is added to the timer.
3. The winner is the last one to place a bid when the timer reaches zero.
4. The retail price, let's say is $500.00.
5. The auction hopes the item will receive enough bids to cover the cost of the item, and make some profit.
For example:
1. Let's say the bid price was $0.50 each
2. Using the above laptop, the penny auction would want more than 1,000 bids placed to break even.
1,000 bids would bring the price of the auction to only $10.00.
3. If you were the 1,000th bid and the timer reached zero you would be the winner, and after paying the $10.00 and shipping, the laptop would be yours.
Here is a hot new Penny auction that will be launching soon:
Bid4cheaponline.com
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