If a Buyer in an Economic Transaction Has More Information

question 13

Multiple Choice

If a buyer in an economic transaction has more information than the seller, the buyer benefits at the expense of the seller.This phenomenon is due to

• A)moral hazard.
• B)adverse selection.
• C)economically irrational behaviour.
• D)gains from trade.

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Definitions:

Reliability And Validity

Terms used in research and evaluation to describe the consistency (reliability) and accuracy (validity) of a measure or test.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus, leading to a learned response.

Operant Conditioning

A learning process by which the strength of a behavior is modified by reinforcement or punishment.

Voluntary Responses

Actions or reactions that are consciously controlled and chosen by an individual, as opposed to automatic or reflexive responses.