Multiple Choice
How can signalling theory explain the advertising strategies of a firm that produces a good quality product
A) It is not a good example of asymmetric information.
B) It has more to gain by signalling (advertising) than does a firm with an inferior product.
C) It will never signal (advertise) , regardless of the cost of the signal.
D) It will signal (advertise) only if the cost of the signal is very low.
Correct Answer:
Verified
Correct Answer:
Verified
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