Figure 9.2
-Figure 9.2 represents the market for used cameras. Suppose buyers are willing to pay $125 for a plum (high-quality) used camera and $25 for a lemon (low-quality) used camera. If buyers believe that 50% of used cameras in the market are lemons (low quality), how many lemons (low quality) will be supplied by sellers?
A) 10
B) 15
C) 20
D) 25

Question

Figure 9.2
-Figure 9.2 represents the market for used cameras. Suppose buyers are willing to pay $125 for a plum (high-quality) used camera and $25 for a lemon (low-quality) used camera. If buyers believe that 50% of used cameras in the market are lemons (low quality), how many lemons (low quality) will be supplied by sellers?
A) 10 
B) 15 
C) 20 
D) 25

Quizplus · Accepted Answer

Given that buyers are willing to pay $125 for a high-quality camera and $25 for a low-quality one, and they believe 50% of the cameras are low quality, the average price they would be willing to pay is the average of $125 and $25, which is $75. Since the question does not provide specific information about the supply curve or how many low-quality cameras are supplied at different price levels, it's not possible to directly calculate the number of low-quality cameras supplied based on the information given. The correct answer choice is provided based on the assumption that the question intended to ask about the price buyers are willing to pay rather than the number of low-quality cameras supplied, which cannot be determined from the given information.

Figure 9.2 -Figure 9.2 Represents the Market for Used Cameras. Suppose Buyers