What is defined as an electronic auction?

An electronic auction is characterized by being conducted online, where bidders submit their bids through a digital platform. This modern auction format allows participants to join from various locations, eliminating the need for physical presence. It enhances convenience and accessibility, making it easier for a larger number of bidders to engage in the auction process.

This definition is distinct and important because while traditional auctions involve physical locations and in-person interactions, electronic auctions utilize technology to facilitate bidding. This means that options which mention physical locations or in-person bidding do not fit the definition of an electronic auction. Moreover, the option referencing paper bids exclusively further highlights a method that is outdated in the context of electronic auctions, which rely entirely on a digital interface for submitting bids. Hence, the correct choice accurately captures the essence and mechanics of what an electronic auction entails.