Which type of auction allows bidders to submit bids in secret?

The correct answer is the sealed bid auction, where bidders submit their bids confidentially without knowing what other participants have bid. This format is designed to ensure that each bid remains private until the specified deadline, at which point all bids are opened simultaneously. This type of auction is often used in situations where an open competition might drive prices up, allowing bidders to propose their true value without the influence of observing what others are willing to pay.

In contrast, a public auction is characterized by open bidding where participants can see each other's bids and raise them accordingly. A live auction also involves openly competing against each other, typically in a physical venue, where an auctioneer calls for bids, and bidders openly signal their offers. Similarly, a silent auction does involve some level of secrecy as bidders write their bids down privately before the auction ends, but it is typically not conducted in a sealed manner where bids remain entirely unknown until the end. Therefore, it’s the sealed bid auction that specifically meets the criteria of bidders submitting their bids in secret.