11. In the market for used motorcycles there are high- and low-quality motorcycles. Potentialbuyers cannot determine prior to purchase whether a motorcycle is high- or low-quality.The following statement that best describes what is likely to happen in this market is:
(A) The price of a used motorcycle will be very close to the value of a high-qualitymotorcycle, which will encourage people to sell high-quality motorcycles.
(B) The price of a used motorcycle will be between the buyer and seller values forlow-quality motorcycles. This will encourage people to withdraw high-qualitymotorcycles from the market.
(C) This is an example of adverse selection, as the buyer will have more informationabout the quality of the used motorcycle than the seller will.
(D) Over time the market price of a used motorcycle will increase, as there is more ofan incentive for owners of high-quality motorcycles to sell than owners of low-qualitymotorcycles.