Examlex
You are worried about how your child is doing at school while your boss is giving the quarterly report.
Adverse Selection
A situation where the lack of symmetric information between buyers and sellers leads to transactions in which less desirable goods or services are more likely to be selected.
Moral Hazard
A situation where one party is more likely to take risks because they know the negative consequences will be borne by another party.
Asymmetric Information
A situation where one party in a transaction has more or better information than the other, leading to an imbalance of power and potentially inefficient market outcomes.
Asymmetric Information
A situation in which one party in a transaction has more or superior information compared to the other party.
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