Which of the Following Relationships Involves Asymmetric Information

question 43

Multiple Choice

Which of the following relationships involves asymmetric information?

• A) An employee knows more than his employer knows about his work effort.
• B) A borrower knows more than the lender about his ability to repay the loan.
• C) The seller of a 30-year-old house knows more than the buyer about the condition of the house.
• D) All of the above are correct.

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Definitions:

Nutritious Snacks

Snack foods that are high in nutritional value, providing vitamins, minerals, and energy, and contributing to overall health.

Choking

The blockage of the upper airway, which prevents normal breathing and can be a life-threatening emergency.

Finger Foods

Small pieces of food that can be easily picked up and eaten with the fingers, often introduced to toddlers during weaning.

Saturated Fat

A type of dietary fat found in animal products and certain oils that is solid at room temperature and associated with increased cardiovascular risk.