Consider the used-car market for the 2006 Citrus described in Section 4.A.  There is now a surge in demand for used Citruses; buyers would now be willing to pay up to $18,000 for an orange and $8000 for a lemon. 

a.  What price would buyers be willing to pay for a 2006 Citrus of unknown type if the fraction of oranges in the population, f, were p.6?

b.  Will there be a market for oranges if f=0.6?  Explain.

c.  What price would buyers be willing to pay if f were 0.2?

d.  Will there be a market for oranges if f=0.2?  Explain.

e.  What is the minimum value of f such that the market for oranges does not collapse? 

f.  Explain why the increase in the buyers’ willingness to pay changes the threshold value of f, where the market for oranges collapses.