In Solidity, a contract resembles a class in object-oriented languages, and it defines almost all conventional elements: variables, functions, structures, interfaces, libraries, inheritance, and so on.

The first line—version pragma ^0.4.24;—is a declaration of Solidity's compiler version that your particular code should use. The caret operator (^) indicates that the preceding code will not compile with an earlier compiler, but will compile with both 0.4.24 and any newer version that doesn't introduce any breaking changes.

The second line—contract Auction {...}—declares a contract with the name Auction.