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mdagenh1 mdagenh1
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4 years ago



Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. If buyers believe that 50% of used digital cameras in the market are lemons (low quality), what is consumers' willingness to pay ($W)?

▸ $100

▸ $200

▸ $300

▸ $400
Textbook 
Survey of Economics: Principles, Applications and Tools

Survey of Economics: Principles, Applications and Tools


Edition: 6th
Authors:
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vvnluuvvnluu
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Answer accepted by topic starter
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#2
4 years ago



Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. If buyers believe that 50% of used digital cameras in the market are lemons (low quality), how many plums will be supplied by sellers?

▸ 50

▸ 60

▸ 150

▸ 200
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amw87470amw87470
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wrote...
#4
4 years ago
Thanks
Answer accepted by topic starter
wrote...
#5
4 years ago



Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. If buyers believe that 50% of used digital cameras in the market are lemons (low quality), what percent of used digital cameras sold will actually be lemons? (low-quality)?

▸ 25%

▸ 50%

▸ 75%

▸ 100%
Answer verified by a subject expert
NicoleLoveNicoleLove
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wrote...
#7
4 years ago



Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. Initially buyers believe that 50% of used digital cameras in the market are lemons (low quality). Compared to the outcome with neutral expectations, how many fewer digital cameras are sold in equilibrium?

▸ 90

▸ 110

▸ 140

▸ The number of cameras sold in equilibrium is the same as the outcome with neutral expectations.
wrote...
#8
4 years ago
140
wrote...
#9
4 years ago
Thank you
Answer accepted by topic starter
wrote...
#10
4 years ago



Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. At any price between $X and $Z:

▸ only plums will be supplied.

▸ only lemons will be supplied.

▸ both plums and lemons will be supplied

▸ neither plums nor lemons will be supplied.
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qwer34qwer34
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