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Summary of this Tutorial:
"Hey It's Bill And Mike, Grab Your 101 Free WordPress Plugins Below"
Start by installing and activating the Ultimate WordPress Auction Plugin.
Go to Ultimate Auction to configure, under settings you can set up your currency and payment options.
Under payment you can add Paypal as an option.
Add auctions under the auction tab and click save.
Create an auctions page and add the shortcode to allow your users to view them.
There is also a premium version of this plugin to give you more control and options for your auctions.
Ultimate WordPress Auction Plugin