The Major Prediction of the Lemons Model Is That

question 57

Multiple Choice

The major prediction of the lemons model is that

• A) the presence of asymmetric information reduces the average quality of goods for sale.
• B) most used cars are worthless.
• C) if one sells a used car in good condition,one will not be penalized.
• D) if one buys a used car,one can expect it to be in good condition.
• E) the presence of asymmetric information increases the average quality of goods for sale.

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Definitions:

Major Decision

A significant choice or judgement that has a long-lasting effect on an individual's life or an organization's direction.

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A collection of documents and materials that showcase an individual's skills, achievements, and experiences, typically used for job applications.