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:

Clairvoyance

The supposed ability to gain information about an object, person, location, or physical event through extrasensory perception, beyond the known human senses.

Precognition

The knowledge of an event before it happens, often considered as a type of extrasensory perception.

Telepathy

The alleged exchange of information between individuals without utilizing any established human senses or physical interaction.

Light Wave's Amplitude

The height of a light wave, which determines the brightness or intensity of the light.