Some fraction d of all new cars is defective

Some fraction d of all new cars is defective

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It is known that some fraction d of all new cars is defective. Defective cars cannot be identified as such except by the people who own them. Each consumer is risk neutral and values a non defective car at $6000. New cars sell for $4000 each, used ones for $1000. If cars do not depreciate physically with use, what is d?

Reference no: EM13689403

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