The classic example used to discuss the problem of adverse selection is:
A)the lemons problem.
B)the market for used cars.
C)the imbalance of information that exists between a buyer and seller of a used car.
D)All of these statements are true.

Question

Quizplus · Accepted Answer

The lemons problem, the market for used cars, and the information imbalance between buyer and seller are all related to adverse selection, making all statements true.

The Classic Example Used to Discuss the Problem of Adverse