Ken and suzy were interested in trading in their four-door sedan for a sportier convertible car. they had successfully negotiated a straightforward trade and had filled out the sales contract. the car salesman took the paperwork to his manager's office for approval but came back looking dejected. "i'm terribly sorry," the car salesman said. "my manager won't let me complete the trade. he says that the convertible is worth much more than your sedan. we can still make a deal, but you will have to pay $5,000 in addition to your trade-in." in this scenario, the salesman is attempting the:

Demand increases by less than supply increases. as a result, (a) equilibrium price will decline and equilibrium quantity will rise. (b) both equilibrium price and quantity will decline. (c) both equilibrium price and quantity will rise

Analyzing and computing accrued warranty liability and expense waymire company sells a motor that carries a 60-day unconditional warranty against product failure. from prior years' experience, waymire estimates that 2% of units sold each period will require repair at an average cost of $100 per unit. during the current period, waymire sold 69,000 units and repaired 1,000 units. (a) how much warranty expense must waymire report in its current period income statement? (b) what warranty liability related to current period sales will waymire report on its current period-end balance sheet? (hint: remember that some units were repaired in the current period.) (c) what analysis issues must we consider with respect to reported warranty liabilities?

With signals from no-claim bonuses and deductibles, a. the marginal cost curve for careful drivers lies to the left of the marginal cost curve for aggressive drivers b. auto insurance companies insure more aggressive drivers than careful drivers because aggressive drivers have a greater need for the insurance c. the market for car insurance has a separating equilibrium, and the market is efficient d. most drivers pay higher premiums than if the market had no signals