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Diano4ka-milaya [45]
3 years ago
12

Suppose that there is asymmetric information in the market for used cars. Sellers know the quality of the car that they are​ sel

ling, but buyers do not. Buyers know that there is a 50​% 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​ $15,000. Based on this​ probability, the most that a buyer would be willing to pay for a used car is ​$________. ​(Enter your response rounded to the nearest​ dollar.)
Business
1 answer:
zepelin [54]3 years ago
3 0

Answer:

$22,500

Explanation:

Chance of getting low quality car = 50%

Chance of getting high quality car = 50%

Cost of low quality car = $15,000

Cost of high quality car = $30,000

So, Price of the car = 50% of lower quality + 50% of higher quality

= (50% × $15,000) + (50% ×30,000)

=  $7,500 + $15,000

= $22,500

Hence, price of the used car will be $22,500.

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aliya0001 [1]

Answer:

Inheritance

Explanation:

The above question highlights example of inheritance. Whenever the ownership of business is transferred from one generation to another, it can be taken as an example of inheritance in a capitalist system.

The same has happened in the above question as well. Chet Bowes who owned his own lanscapped business has now transferred the ownership to his son Josh who has recently taken charge, now it is very much clear from the question neither Josh built the company on his own now was hired on the basis of his capabilities, the transfer happened on the basis of his relationship with the owner of the company. The question shows an example of inheritance.

5 0
2 years ago
Here are data on two companies. The T-bill rate is 5.8% and the market risk premium is 7.4%.
cupoosta [38]

Answer:

18.38% and 13.2%

Explanation:

As we know that

Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)

So for Discount store, it is

= 5.8% + 1.7 × 7.4%

= 5.8% + 12.58%

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And for everything store, it is

= 5.8% + 1.0 × 7.4%

= 5.8% + 7.4%

= 13.2%

The Market rate of return - Risk-free rate of return) is also known as the market risk premium and the same is applied.          

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3 years ago
An auto repair technician who specializes in the installation, troubleshooting, and repair of heating and air conditioning syste
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<span>This person would be a "passenger comfort specialist.</span>
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Research indicates that we form more positive impressions of physically attractive people than we do unattractive people. Explai
mario62 [17]

Answer: The use of attractive people in advertisements is for the purpose of promoting what they are looking to sell.

In the case of movies, the benefit is also sought, that is, more people will watch a movie if the actor who plays it is physically attractive.

In fairy tales it is sought to show the good as beautiful and the bad as ugly, it is easy for children to understand.

Getting familiar with unattractive people, paying attention to characteristics in common, and developing good relationships are some suggestions of how unattractive people can feel more positive.

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2 years ago
When you view a selection at Amazon and see "Customers who bought this (item) also bought ...," you are seeing the application o
Dima020 [189]

Answer: collaborative filtering

Explanation:

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When you view a selection at Amazon and see "Customers who bought this (item) also bought ...," you are seeing the application of collaborative filtering.

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