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Suppose that there are two types of cars: high value (which are worth $10,000 to buyers) and low value (which are worth $5,000 to buyers).
Suppose that there are two types of cars: high value (which are worth $10,000 to buyers) and low value (which are worth $5,000 to buyers). If buyers cannot observe the quality of a car before buying it, they will be willing to pay ______ for a car. Thus, the sellers of high-value cars _____ be willing to sell their cars. The result of this information asymmetry will be that there are ____________, a problem known as adverse selection. Question 1 options: Less than $10,000 / will / no high-value cars in the market More than $10,000 / will / no high-value cars in the market Less than $10,000 / will not / no high-value cars in the market More than $10,000 / will not / no low-value cars in the market Less than $10,000 / will not / no low-value cars in the market
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