In Rustbucket, Michigan, There Are 200 Used Cars for Sale

Multiple Choice

In Rustbucket, Michigan, there are 200 used cars for sale, half of them are good and half of them are lemons.Owners of lemons are willing pay $200 for a lemon and $2,300 for a good car.Buyers can't tell good cars from bad, but original owners know.

A) There will be an equilibrium in which all used cars sell for $1,250.
B) There will be an equilibrium in which all used cars sell for $700.
C) The only equilibrium is one in which all used cars on the market are lemons and they sell for $200.
D) There will be an equilibrium in which lemons sell for $100 and good used cars sell for $1,300.
E) There will be an equilibrium in which lemons sell for $200 and good used cars sell for $2,300.