Question

Harlan's Used Autos prides itself on its efficiency and value in delivering vehicles that have had full mechanical reviews by trained mechanics before the vehicles are sold and a detailed list of known defects that have not been corrected provided to each customer. These characteristics can best be defined as Harlan's.

Answer 1

Marvin should consider the risk-versus-reliability tradeoff when purchasing a used car, understanding that price often reflects a dealer's reputation and the likelihood of buying a "lemon."

Step-by-step explanation:

Marvin should balance his appetite for risk with the potential for unanticipated repairs. Used cars from lots with a trustworthy reputation tend to be more expensive, reflecting the dealer's commitment to reliability and customer satisfaction. These dealers mitigate the problem of imperfect information by fixing not-so-obvious issues and maintaining a strong reputation to avoid the long-term consequences of selling defective cars, or "lemons." On the other hand, less established lots or individual sellers, such as those on Craigslist, may offer lower prices, but with higher risk to the buyer as their reputation has less at stake. Marvin needs to consider whether the upfront savings are worth the additional risk of frequent repairs.