One Result of Asymmetric Information in the Market for Bank

question 124

Multiple Choice

One result of asymmetric information in the market for bank loans is that

• A)few loans are offered
• B)few bad loans are made
• C)more bad loans than good loans may be made
• D)lenders benefit at the expense of borrowers
• E)the interest on good loans will be higher than otherwise

---

Definitions:

Ethical Dilemmas

Situations where individuals are required to choose between two conflicting moral principles.

Legal Consequences

The result of actions that are subject to law, which can include penalties, fines, or other legal outcomes.

Conflicts of Interest

Situations where individuals' personal interests might compromise their decision-making or duties.

Ethical Dilemmas

Situations in which a person must choose between two or more conflicting moral principles, making it challenging to decide the right course of action.