Certifying a Used Car Through a Brand Dealership

question 46

Multiple Choice

Certifying a used car through a brand dealership:

• A)corrects an inefficiency in the market.
• B)allows more transactions to take place that are valuable to buyers and sellers.
• C)credibly signals which cars are not lemons.
• D)All of these statements are true.

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Definitions:

Intangible Benefits

These are advantages that cannot be easily measured in monetary terms, such as brand reputation or employee morale.

Discount Rate

The rate used in discounted cash flow analysis to determine the present value of future cash flows, reflecting the opportunity cost of capital.

Salvage Value

The estimated residual value of an asset at the end of its useful life, important for calculating depreciation.

Automated Equipment

Machinery that operates with minimal human intervention, often using computer control systems to perform tasks more efficiently.