There are three quality levels of cars on a used car market:= 80 ("bad")120 ("medium")= 200 ("good")%3DThe proportion of cars in the three quality levels is 1/3 each. Only the seller knows the qualitylevel. The reservation prices of the sellers are each ¾ of the quality level. The carsare sold to the highest bidder. Whichstatement is correct?Choose an answerO 1. An equilibrium price is 200.2. An equilibrium price is 90.O 3. An equilibrium price is 100.O 4. An equilibrium price is 120.O 5. Aoequilibrcium price ie 132 1/3.

Answer - Given in the question- There are three quality levels of cars on a used car market 80…

Answered: There are three quality levels of cars…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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O $300 Question 11 3 pts Consumers are willing to pay a higher price for a brand-name product as opposed to a generic product because O they are willing to pay more for the privilege of watching the firm's commercials. O consumers maximize utility by purchasing the most expensive products. O a brand name provides a signal about a product's quality and reliability. O a brand-name product itself is always of higher quality. 3 pts Question 12 As competitors enter a market, demand becomes more meaning the demand curve
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Someone at a party pulls out a $100 bill and announces that he is going to auction it off. There are n=10 people at the partywho are potential bidders. The owner of the $100 bill puts forth the following procedure: All bidders simultaneously submit a written bid. Only the highest bidders pay their bid (assuming that the highest bid is positive). If m people submit the highest bid, then each receives 1/m of the $100. Each person’s strategy set is {0,1,2,...,1000}{0,1,2,...,1000} so bidding can go as high as $1,000. The payoff of a player bidding bi is:0 if bi < max{b1,b2,…,bn},and 100/m − bi if bi = max {b1,b2,…,bn}where,m is the number of bidders whose bid equals max{b1,...,bn}. How many pure-strategy Nash equilibria does this game have? 1) 0 2) 1 3) 4 4) More than 4.
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B a) Curve 2 and Point C b) Curve 3 and Point A D E e) Curve 2 and Point B A с Curve 4 Oc) Curve 4 and Point D O d) Cannot tell with the information presented Assume that consumer preferences change due to the positive health benefits of broccoli recently reported in the news, and thus, increases demand for broccoli. Assume "Point E" shows the equilibrium point before the new information was reported. Without any additional information, which curve and point reflects what you might expect to occur to demand and the equilibrium price (if any change)? Curve 2 Curve 3 Axis 2
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