Which of the following products or services would be likely to encounter adverse selection? used cars, a
Question:
Which of the following products or services would be likely to encounter adverse selection? used cars, a local restaurant, McDonald's, a traveling musical show?
a. pick one of the products or services that would be likely to encounter adverse selection and one of the products or services unlikely to encounter adverse selection and explain why; what characteristic(s) of the product or service makes it likely or unlikely to encounter adverse selection?
b. for the good you selected above that would experience adverse selection, what could the seller do to minimize the effects of adverse selection (in other words, how could the seller convince the buyer that the good was of high quality?
Managerial economics applications strategy and tactics
ISBN: 978-1439079232
12th Edition
Authors: James r. mcguigan, R. Charles Moyer, frederick h. deb harris