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Tems11 [23]
2 years ago
12

Suppose that in a market for used cars, there are good used cars and bad used cars (lemons). Consumers are willing to pay as muc

h as $6,000 for a good used car but only $1,000 for a lemon. Sellers of good used cars value their cars at $5,000 each and sellers of lemons value their cars at $800 each. Buyers cannot tell if a used car is reliable or is a lemon. Based on this information, what is the likely outcome in the market for used cars
Business
1 answer:
Viktor [21]2 years ago
5 0

Answer:

Based on the given information, the mostly likely outcome in the market for used​ cars is, sellers of good used cars will drop out of the market.

Explanation:

From the above mentioned scenario, we can figure out that in the marker of used cars, good used cars have a higher pay and value as compared to the bad used cars. But when it comes to buyers, they cannot really make a differentiation between whether the used cars are well grounded or lemon. So in that case, there is a likelihood of dropping good used cars out of market. This is mainly because when buyers cannot judge the reliability of an item, chances are that the item will drop out.

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A group of executives attended a meeting in which the CFO was the attendee with the most senior ranking. When the meeting began,
givi [52]

Answer:

Group think bias

Explanation:

Groupthink bias occurs when people believe in something because other people believe in it. It is when everyone comes to the same conclusion concerning a matter.

In the meeting everyone agreed with the CEO, this is an instance of groupthink.

Anchoring bias is when a person's decision is overly anchored on an initial information given when making a decision.

Confirmation bias is when a person arrives at a conclusion in line with their beliefs.

Availability bias is basing decisions on past instances that comes to mind when making the decision.

Hindsight bias occurs when people over estimate their abilities to predict how an event would have turned out in hindsight.

7 0
3 years ago
The minute karen walks into your mother-in-law's house to visit, she is struck by the strong smell of her perfume. however, afte
fenix001 [56]

Answer:

sensory adaptation

Explanation:

As when you enter a new area basically there is change of environment and the senses activate and if there will be a slight change also in the smell, and quality of air that will be noticed by the body.

After certain time is spent even in the changed environment the body starts accepting such change and accordingly after few minutes even though the smell was recognizable earlier will have no effect now.

This is called sensory adaption, that is with some time the senses adapt such change.

5 0
3 years ago
A 16-ounce bottle of Prairie Herb vinegar sells for $4.95, and a 16-ounce bottle of Heinz vinegar costs $1.05 . Prairie Herb vin
Gelneren [198K]

Answer:

Price Skimming

Explanation:

Prairie Herb Vinegar is new to the market and using a price skimming strategy. This is where the product is sold at the highest price a certain customer base will be willing to purchase the product at. This also creates a scenario where a perception of quality is created. As the company attempts to attract more customers they will lower the price of the product hopefully expanding their existing customer base.

5 0
3 years ago
Read 2 more answers
Which of the following is the subjective performance measure at parent firm level? a. Profitability b. Market share c. Stlck mar
Rufina [12.5K]

Answer:

d. Assessment of goal attainment

Explanation:

In cases where an alliance occurs between a parent firm and a subsidiary, the parent firm subjectively measures performance by assessing the extent to which the alliance has contributed to achieving the organization's goals.

5 0
3 years ago
Heather Company is considering the acquisition of a machine that costs $360,000. The machine is expected to have a useful life o
Angelina_Jolie [31]

Answer:

3 years

Explanation:

The cash payback period measures how long it takes for the amount invested in a project to be recouped from cumulative cash flows.

Explanations on how the payback period is calculated can be found in the attached image.

Please contact me if you need clarification.

I hope my answer helps you.

6 0
2 years ago
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