When a Transaction Takes Place Repeatedly,then One Way to Signal

question 125

Multiple Choice

When a transaction takes place repeatedly,then one way to signal to avoid information asymmetry is:

• A) building a reputation.
• B) screening.
• C) statistical discrimination.
• D) Any of these could be true.

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Definitions:

Competitive Situations

Scenarios in which individuals or groups compete against each other to achieve a specific goal or outcome.

Neuroticism

A personality trait characterized by emotional instability, anxiety, moodiness, worry, and a tendency towards negative emotions.

Negative Affectivity

A characteristic of personality marked by a consistent tendency toward negative feelings and a low self-esteem.

Sunk Costs

Costs that have already been incurred and cannot be recovered, which should not affect future decision-making but often do.