What type of auction involves increasing prices and is conducted between pre-qualified suppliers and a buying organization?

The correct choice, which focuses on reverse auctions, applies to situations where buyers invite suppliers to compete by lowering their prices in response to demands or specifications provided by the buying organization. In a reverse auction format, the price starts high and can decrease as suppliers place increasingly competitive bids. This setting encourages suppliers to reduce their costs in order to win the contract, working collaboratively rather than in a conventional competitive bidding style.

In the case of reverse auctions, the interplay is fundamentally different from traditional auctions, where the price usually goes up. In a traditional auction, buyers typically bid higher and compete to obtain goods or services. Silent auctions involve bids being submitted without real-time visibility of others' bids, creating a different atmosphere and dynamics from those observed in a reverse auction setting. Online auctions can encompass various types and formats, including both traditional and reverse mechanisms, but do not specifically identify the increasing price dynamic that is characteristic of traditional auctions. Thus, the defining features of a reverse auction—pre-qualified suppliers working to lower their bids in a competitive environment—align directly with the question's criteria.