I would like to know whether this is correct:
He uses a car instead of a bus.
What does he use a car instead of?
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Yes, that is perfectly fine. It is an instance of preposition stranding per Wikipedia:
Preposition stranding, sometimes called P-stranding or dangling, is the syntactic construction in which a preposition with an object occurs somewhere other than immediately adjacent to its object. (The preposition is then described as stranded, hanging or dangling.) This construction is widely found in Germanic languages, including English and the Scandinavian languages.
It then specifically points out Wh-movement as one of the places where this occurs, and gives the example of
What are you talking about?
For more about this see “An internet pilgrim’s guide to stranded prepositions” on the Language Log. Pay especial attention to the part about pied piping making for awkward and pretentious-sounding sentences.