Paul is looking for a used washing machine. He has posted his requirement in an exchange Web site and has also mentioned the maximum amount that he is willing to pay for it

If his willingness to pay is lower than the price of good-quality used washing machines, what is likely to happen?

Paul's advertisement is likely to attract sellers of low-quality washing machines. This is because Paul's willingness to pay is well below the market price of high-quality used washing machines. Good-quality washing machines are valued at high prices and therefore owners of these machines will not be willing to sell at the price quoted by Paul. This is an example of adverse selection.