Ratings and Reviews of Mechanics on the Internet

question 143

Multiple Choice

Ratings and reviews of mechanics on the Internet:

• A) make it easier to avoid shady mechanics, thus reducing moral hazard.
• B) raise the cost to mechanics of exploiting their adverse selection advantage.
• C) make it easier for mechanics to take advantage of their information advantage.
• D) completely prevent all forms of information asymmetries.

---

Definitions:

Costs

The amount of money required for the production of goods or services, including materials, labor, and overheads.

PPACA

The Patient Protection and Affordable Care Act, a comprehensive health care reform law enacted in March 2010, aimed at expanding health insurance coverage in the United States.

Firms

Firms are business entities established to produce goods or provide services with the goal of earning profits in a market economy.