There Are Two Types of Used Cars, High Quality and Low

question 21

Multiple Choice

There are two types of used cars, high quality and low quality.Buyers cannot distinguish the two types until after they have purchased them.Owners of high-quality cars will sell them if the price is $2,000 or higher.Owners of low-quality cars will sell them if the price is $1,000 or higher.Buyers value a high-quality used car at $1,942 and a low-quality used car at $1,200.Suppose that 70% of used cars are of high quality and 30% of used cars are of low quality.In equilibrium,

• A)only low-quality used cars will be sold.
• B)only high-quality used cars will be sold.
• C)no used cars will be sold.
• D)all used cars will be sold.
• E)high-quality used cars will sell for a uniformly higher price than low-quality used cars.

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Definitions:

Motivational Concepts

Refers to the theories and principles that explain what drives and influences individuals to act and behave in certain ways.

Effective Leadership

The ability of an individual to guide, inspire, and motivate a group towards achieving its goals.

High-Performance Outcomes

Exceptional results achieved by an entity, surpassing standard benchmarks or expectations.

Maslow's Hierarchy

A theory in psychology proposed by Abraham Maslow, which outlines a hierarchy of human needs, from basic physiological needs to self-actualization.