User Account

All Pages

Asymmetric information in the market for used cars

Assignment Help Business Economics
Reference no: EM131584665

Suppose there is asymmetric information in the market for used cars. Sellers know the quality of the car they are selling, but buyers do not.

Buyers know that there is a 30% chance of getting a "lemon", a low quality used car. A high quality used car is worth $30,000, and a low quality used car is worth $15,000. Based on the probability, the most that a buyer would be willing to pay for a used car is $_______ (round response to the nearest whole dollar)

Reference no: EM131584665

Questions Cloud

Describe two high-risk tasks : Describe two (2) high-risk tasks, and provide a recommendation to address each.Discuss how you would address these recommendations with the UAP on the unit.
Give the name of one international entry strategy : Give the name of ONE international entry strategy your company has used to enter foreign markets. Provide specifics in support of your answer.
Corporation after looking at swot analysis : Write a strong conclusion of your overall findings and thoughts on the corporation (Honeywell) after looking at a SWOT Analysis.
What adjustment is necessary for linden buildings account : Fairhaven Company acquired 90% of Linden Company on January 1 20X3, In consolidation at January 1 20X3 what adjustment is necessary for Linden buildings account
Asymmetric information in the market for used cars : Suppose there is asymmetric information in the market for used cars. Sellers know the quality of the car they are selling, but buyers do not.
Performance reviews have been declining recently : Your HR Manager comes to you about an employee whose performance reviews have been declining recently, and asks your advice about whether
Describe the ethics and lobbying laws : Explain any ethical dilemmas that could arise during your advocacy campaign, and how you would resolve them.
What is the second step of capital budgeting : What is the second step of capital budgeting? In your own words explain, forecast exchange rates using different methodologies.
Draw the seven non isomorphic sub graphs : Are the three graphs shown in Figure isomorphic? (Are any two of them isomorphic?) If so, exhibit the isomorphism.

Reviews

Write a Review

Business Economics Questions & Answers

  Economics assignment

This document contains various important questions and their appropriate answers in the subject field of Economics.

  Demand and supply curves

Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.

  Long-run perfectly competitive equilibrium for the firm

Evaluate Government intervene and correct this situation?(a) Explain the concept of a concentration ratio. A rise in the price of magarine Explain the impact of external costs and external benefits on resource allocation long-run perfectly c..

  Supply and demand diagrams

Explain each of the following using supply and demand diagrams,  With the use of a graph, explain how these two programs affect cigarette consumption and the price of cigarettes.

  Case study: fisher-price toys

The case study of the Fisher-Price Toys, Inc., a popular case in basic economics and management from the prestigious Harvard Business School.

  Draw the production possibility curve

Draw the production possibility curve and a. Define consumer surplus and producer surplus.

  Tax revenue

The Australian government administers two programs that affect the market for cigarettes

  Maximize total welfare

How many tickets to sell to maximize total welfare.

  Difference between the cv and the ev

The change in consumer surplus (?CS) is not "theoretically" justifiable like the CV and EV but it continues to be the most widely used measure of consumer welfare change. Explain how this can be reconciled

  Depict von neumann-morgenstern utility index u in a diagram

Depict the von Neumann-Morgenstern utility index u in a diagram

  What is the market solution

What is the market solution (market price and quantity) and What is the total surplus of the society under the market solution

  Calculate gross national product and net national product

Calculate gross national product and net national product

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd