MrSmith Put His Laptop Up for Sale

question 29

Multiple Choice

Mr.Smith put his laptop up for sale.He was aware of the fact that the laptop malfunctioned frequently.However,none of the potential customers who came to buy the laptop were able to discover the problem.One of them actually bought it at a remunerative price.This occurred because of the presence of ________.

• A) asymmetric information
• B) positive externalities
• C) negative externalities
• D) the moral hazard problem

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Definitions:

Painful Injury

A physical harm or damage to the body that is accompanied by discomfort or distress.

Lost Work

Creative or scholarly work known to have been created but is no longer extant or cannot be found.

Volenti Non Fit Injuria

A legal defense stating that individuals who willingly put themselves in a situation of risk cannot seek compensation for resulting harm.

Icy Sidewalk

A walkway made slippery by a coating of ice, presenting a hazard to pedestrians.