Ask Question
BusinessBusiness
20 June, 07:11

You are in the market for a used car and decide to visit a used car dealership. You know that the Blue Book value of the car you are looking at is between $20,000 and $24,000. If you believe the dealer knows as much about the car as you do, how much are you willing to pay? Why? Assume that you care only about the expected value of the car you will buy and that the car values are symmetrically distributed.

+1
Answers (1)
  1. 20 June, 07:33
    0
    The expected value of the car you will buy is $22,000

    Explanation:

    In the given question, the car values are symmetrically distributed which means that we have to compute the mean between the values that are mentioned in the question.

    So, the mean is an average of the numbers, the computation is shown below:

    = (Value 1 + value 2) : (number of observations)

    = ($20,000 + $24,000) : 2

    = $22,000
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “You are in the market for a used car and decide to visit a used car dealership. You know that the Blue Book value of the car you are ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Doris, an eighty-seven-year-old widow, collapsed while shopping at a store. she was taken to the detroit city hospital by ambulance. she stayed there for fourteen days and was then transferred to another hospital, where she later died.
Answers (1)
Does gross profit take into account taxes
Answers (1)
An investor company owns 40% of the outstanding common stock of an investee company, which allows the investor to exercise significant influence over the investee. The Equity Investment was reported at $750,000 as of the end of the previous year.
Answers (1)
Berkshire Inc. uses a periodic inventory system. At the end of 2017, it missed counting some inventory items, resulting in an inventory understatement by $670,000.
Answers (1)
For each situation, prepare the appropriate journal entry for the redemption of the bonds. a. Bramble Corp. redeemed $118,000 face value, 9% bonds on April 30, 2022, at 102. The carrying value of the bonds at the redemption date was $106,554.
Answers (1)
New Questions in Business
Difference between a parttime and fulltime job
Answers (1)
On May 1, 2019, Mary Smith signed a $ 13 comma 000 promissory note with Continental Bank. The note is due in one year with 6 % interest. What journal entry should Continental Bank prepare on May 1, 2019?
Answers (1)
On July 15, 2021, the Nixon Car Company purchased 2,100 tires from the Harwell Company for $40 each. The terms of the sale were 3/10, n/30. Nixon uses a perpetual inventory system and the gross method of accounting for purchase discounts.
Answers (1)
Why is it important to understand economics
Answers (1)
One characteristic that is important to consider in social network theory is reciprocity of relationships
Answers (1)
Home » Business » You are in the market for a used car and decide to visit a used car dealership. You know that the Blue Book value of the car you are looking at is between $20,000 and $24,000.
Sign Up Forgot Password?