-The Market for Used Cars Is Shown in the Above

Multiple Choice

-The market for used cars is shown in the above figure.Buyers cannot tell whether any given car is a lemon.Forty percent (40%) of all cars are lemons.However,sellers can switch to selling lemons at lower costs.Which of the following statements is true?

A) Only lemons are sold for $1,600.
B) Only lemons are sold for $800.
C) All the sellers of good cars will switch to selling lemons.
D) 40% buyers will get lemons.