Figure 14.5 represents the market for used cars. Suppose buyers are willing to pay $5,000 for a plum (high-quality) used car and $3,000 for a lemon (low-quality) used car. If buyers believe that 80% of used cars in the market are lemons (low quality), how many plums will be supplied in the market?
A. 30
B. 40
C. 70
D. 120
Answer: B
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The sales revenue a seller receives from the sale of an additional unit of goods is called the marginal benefit
Indicate whether the statement is true or false
At the end of World War II many European countries were rebuilding and so were eager to buy capital goods and had rising incomes. We would expect that the rebuilding increased aggregate demand in
a. both the United States and Europe. b. the United States but not Europe. c. Europe, but not the United States. d. neither the United States, nor Europe.
Exhibit 3-5 Supply for Tucker's Cola Data Quantity supplied per week(millions of gallons) Price pergallon 6 $3.00 5 2.50 4 2.00 3 1.50 2 1.00 1 .50 Exhibit 3-5 shows the supply schedule for Tucker's Cola. Suppose there are four additional suppliers of cola in the market. When the price per gallon of cola is $1.50, the first supplier is willing to sell 10 million gallons, the second supplier is willing to sell 2 million gallons, the third supplier is willing to sell 5 million gallons, and the fourth supplier is willing to sell 0 gallons. The market quantity supplied of cola when the price is $1.50 is
A. 17 million gallons. B. 20 million gallons. C. 30 million gallons. D. 0 gallons.
A lower real interest rate ________ investment spending and ________ consumption spending.
A. increases; decreases B. decreases; decreases C. decreases; increases D. increases; increases