Author Question: If buyers cannot assess the quality of used cars but there are warranties for cars, A) too few ... (Read 142 times)

ereecah · **on:** Jun 29, 2018

If buyers cannot assess the quality of used cars but there are warranties for cars,

A) too few lemons are sold.
B) too many good used cars are sold.
C) good used cars are sold at a higher price than lemons.
D) there is an adverse selection problem.

Question 2

The larger the portion of a person's total budget spent on a good, the more inelastic the demand for the good.

Indicate whether the statement is true or false