Figure 9.4
-Figure 9.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. At any price between $X and $Z

Question

Quizplus · Accepted Answer

At any price between $X and $Z, only lemons will be supplied because the price is not high enough to incentivize sellers of high-quality cameras (plums) to sell, but it is sufficient for sellers of low-quality cameras (lemons) to sell.

Figure 9.4 -Figure 9.4 Represents the Market for Used 12 Megapixel Digital