If you bid $2 for a click and the next highest bid is $1.25, how much will you pay?
Setting your bids it’s important to understand that your bid and actual cost-per-click your pay are two different things. Your actual cost-per-click (actual CPC) is the final amount you’re charged for a click. I’ts usual lower and sometimes significantly lower than your bid.
In Google Ads, the most you’ll pay is what’s minimally required to hold your ad position and any ad formats shown with your ad, such as sitelinks.
In this case, the minimum required bid would be $1.25 + 0.01 = $1.26