Consider the market for used car. Buyers are willing to pay $1000 for lemons and $2000 for good cars. Sellers reservation price is $800 for lemons and $1800 for good cars.

Q4 (6 marks). Consider the market for used car. Buyers are willing to pay $1,000 for lemons and $2,000 for good cars. Sellers' reservation price is $800 for lemons and $1,800 for good ears. 9 P S S 200 D 130 1000 o 300 0. CI Lemons per year Good cars per- year- a (2 marks). Suppose neither buyers no sellers can tell whether any given car is a lemon. If 40% of all cars are lemons, which types of cars are sold for what prices? I) (2 marks). Suppose new buyers cannot tell whether any given car is a lemon, but sellers know the information. If 40% of all cars are lemons, which types of cars are sold for what prices? c (2 mark). In the case of (b), if 10% of all cars are lemons, which types of cars are sold for what prices