You might like to give out the fake money evenly or based on a different method but if you choose to do a quiz you'll find plenty in our quiz section.
Once they all have some fake money to work with you can either let them bid individually or as groups (perhaps the teams they were already in if you did a quiz).
Before the class I usually go out and buy 5 or 6 cheap prizes including anything from candy to stickers and small toys, it's up to you what to choose but it often depends on the age of your students (older students might not be so keen on stickers for example).
I also like to throw in a few 'duds' to keep them on their toes, the older students tend to find it hilarious when their friends win 'mystery bags' with terrible prizes in them.
Stand at the front of the room with a countdown of how many items are left in the auction written on the whiteboard/blackboard and start the bidding at a small price to get things rolling. Let the students raise their hands and call out their bids in English until someone bids a price that no one else is willing to match, after they hand over the fake cash the prize is theirs!
Continue until all the prizes are gone remembering to give yourself enough time to gather up all the fake money before the class ends.