One Result of Asymmetric Information in the Market for Bank

question 124

Multiple Choice

One result of asymmetric information in the market for bank loans is that

• A)few loans are offered
• B)few bad loans are made
• C)more bad loans than good loans may be made
• D)lenders benefit at the expense of borrowers
• E)the interest on good loans will be higher than otherwise

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Definitions:

Identity

The way an individual perceives themselves, which is influenced by personal, social, and cultural factors.

Conflicting Demands

Situations where an individual is faced with two or more competing requirements or expectations, which can create stress or require resolution through decision-making.

Social Roles

The behaviors, obligations, and privileges attached to a social position, which guide how individuals are expected to act in specific contexts.

Role Strain

A psychological tension experienced when an individual encounters difficulty in fulfilling multiple requirements of the same role.