Which of the following is an example of a government reducing adverse selection by eliminating the lowest-quality products in a market?
A)Requiring that sellers reveal to buyers any known flaws in the product.
B)Requiring a skill or knowledge-based license to offer the product or service.
C)Offering accurate information to buyers.
D)Allowing firms to go out of business if they have insufficient customers.

Question

Quizplus · Accepted Answer

Requiring a skill or knowledge-based license to offer a product or service ensures that only qualified providers can enter the market, thereby reducing the presence of low-quality products or services and addressing adverse selection by elevating the overall quality standard.

Which of the Following Is an Example of a Government