Asymmetric Information in Financial Markets Exists When

Multiple Choice

Asymmetric information in financial markets exists when:

A) borrowers reveal their financial details to banks before borrowing funds.
B) borrowers know more about their ability to repay loans than lenders do.
C) lenders know more about borrowers than borrowers know about themselves.
D) borrowers pay off a loan before it is due.
E) borrowers and lenders have equal information about borrower creditworthiness.