Figure 9.1 -Figure 9.1 Represents the Market for Used Bikes. Suppose Buyers

Multiple Choice

Figure 9.1
-Figure 9.1 represents the market for used bikes. Suppose buyers are willing to pay $200 for a plum (high-quality) used bike and $50 for a lemon (low-quality) used bike. If buyers believe that 50% of the used bikes are lemons (low quality) , how much will they be willing to pay for a used bike?

A) $50
B) $80
C) $125
D) $200