John and Jack Are Both Trying to Sell a Used

question 134

Multiple Choice

John and Jack are both trying to sell a used car to Jim. John's car is a lemon, a car that has a serious but nonobvious problem. Jack's car is a cherry, a car that has no problems. Jim cannot tell the difference between the cars. Economists say this information problem might be solved with signaling. Who has an incentive to find a way to signal quality?

• A) Both Jack and John
• B) Jack but not John
• C) John but not Jack
• D) Jim

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Definitions:

Lymphocytes

A type of white blood cell that plays a vital role in the immune system, involved in protecting the body against infections and diseases.

Granules

Small particles or grains, often referring to components within cells or materials with a granular texture.

WBC Count

A measure of the number of white blood cells in a volume of blood, indicating immune function or potential infection.

Cells

The smallest structural and functional units of living organisms, which can exist as independent units or as part of a larger organism.