The most direct and important consequence of an increase in asymmetric information problems is ________.
A)a decrease in the probability of loan repayment
B)inability to assess the probability of loan repayment
C)unwillingness of borrowers to accept the market rate of interest
D)inability of creditors to acquire enough funds to meet borrowers' demand

Question

Quizplus · Accepted Answer

An increase in asymmetric information problems makes it difficult for lenders to accurately assess the probability of loan repayment due to a lack of reliable information about the borrower's ability or willingness to repay.

The Most Direct and Important Consequence of an Increase in Asymmetric