I think it would probably work better if it was some kind of bidding system, as mentioned above. That way you'll get a better idea of what people are prepared to pay and will thus gain important market info. Right now it will be too easy for people to start making calculations and that will mean they'll probably end up on or around the 50.000 mark.
I've just read a book from Dan Ariely titled "Predictably Irrational". According to his research it is relatively easy to get people to offer in the right price range, provided they have no direct product to compare it with. To do that you need to "anchor" the price. Funnily enough it can be just random numbers. He asked people to write down the last 2 digits of their social security number and then asked them to bid on certain items. People with high numbers also bid significantly higher. To anchor the price in this case they should just open the bids and mention that comparable products retail for $ 25, something like that. Right now they've anchored it at the 16.67 mentioned above.