Solved

-The Market for Used Cars Is Shown in the Above

Question 20

Multiple Choice

-The market for used cars is shown in the above figure.Neither buyers nor sellers can tell whether any given car is a lemon.Forty percent (40%) of all cars are lemons.Which of the following statements is TRUE? A) All of the cars will be sold at $1,600. B) No cars will be sold. C) Only lemons are sold for $1,000. D) Only good cars will be sold for $2,000.
-The market for used cars is shown in the above figure.Neither buyers nor sellers can tell whether any given car is a lemon.Forty percent (40%) of all cars are lemons.Which of the following statements is TRUE?


A) All of the cars will be sold at $1,600.
B) No cars will be sold.
C) Only lemons are sold for $1,000.
D) Only good cars will be sold for $2,000.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q4: In the tourist-trap model,a consumer might pay

Q6: If you sell your DVD player on

Q16: A pooling equilibrium occurs when<br>A) dissimilar workers

Q24: A person who starts practicing poisonous snake

Q38: Signals can help prevent adverse selection as

Q46: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB6808/.jpg" alt=" -The market for

Q60: How can a warranty at the seller's

Q68: If bad drivers can usually avoid being

Q72: If consumers have limited information about price

Q100: If getting accepted into college is very