Business, 14.12.2019 00:31 seth3336

Suppose that there are 6 qualities of car, q, equal to 0, 1/4, 1/2, 3/4, 1, 5/4, 3/2, 7/4, and 2. one thousand people currently own each quality of car and there are as many people interested in buying them. the value of the cars to the people that currently own them is given by 2000q. prospective buyers are willing to pay 3000q.

i) suppose that buyers and sellers know the quality of each car. what is the competitive market price for each quality of car? do all cars get sold? price for each car? do all cars get sold? price for each car? do all cars get sold? carefully show your reasoning.
ii) suppose that neither buyer nor seller can observe the quality of the car. what is the competitive market
iii) suppose that the sellers know the quality of the car they have to sell. what is the competitive market
iv) the market described in part iii above is usually called adverse selection (also the market for lemons). describe some institutions that might evolve to fight the adverse selection problem for used cars.

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 13:50

When used-car dealers signal the quality of a used car with a warranty, a. buyers believe the signal because the cost of a false signal is high b. it is not rational to believe the signal because some used-car dealers are crooked c. the demand for lemons is eliminated d. the price of a lemon rises above the price of a good used car because warranty costs on lemons are greater than warranty costs on good used cars

Answers: 2

Answer

Business, 22.06.2019 16:10

Regarding the results of a swot analysis, organizational weaknesses are (a) internal factors that the organization may exploit for a competitive advantage (b) internal factors that the organization needs to fix in order to be competitive (c) mbo skills that should be emphasized (d) skills and capabilities that give an industry advantages problems that a specific industry needs to correct

Answers: 1

Answer

Business, 22.06.2019 19:20

This problem has been solved! see the answerwhich of the following statements is correct? the consumer price index is a measure of the overall level of prices, whereas the gdp deflator is not a measure of the overall level of prices. if, in the year 2011, the consumer price index has a value of 123.50, then the inflation rate for 2011 must be 23.50 percent. compared to the gdp deflator, the consumer price index is the more common gauge of inflation. the consumer price index and the gdp deflator reflect the goods and services bought by consumers equally well.

Answers: 2

Answer

Business, 22.06.2019 20:00

River corp's total assets at the end of last year were $415,000 and its net income was $32,750. what was its return on total assets? a. 7.89%b. 8.29%c. 8.70%d. 9.14%e. 9.59%

Answers: 3

Answer

You know the right answer?

Suppose that there are 6 qualities of car, q, equal to 0, 1/4, 1/2, 3/4, 1, 5/4, 3/2, 7/4, and 2. on...

Questions