Which of the Following Is True of Adverse Selection

Multiple Choice

Which of the following is true of adverse selection?

A) ​It can result when one of the parties to a transaction has little information about the quality of the goods involved.
B) ​It can cause the quality of goods traded to fall, if quality detection costs are high.
C) ​It can be a difficult problem to overcome, because it is not individually rational for the transactor with the superior information to provide a truthful and complete disclosure.
D) ​All of the above are true.