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Which of the Following Is an Example of Asymmetric Information

Question 14

Multiple Choice

Which of the following is an example of asymmetric information leading to a "lemons" market?


A) A marketing manager is uncertainty about the volume of sales in the next quarter.
B) An employee does not know the rate of inflation in the coming year and so cannot ascertain his real wage.
C) The seller of a used laptop knows more about its true condition than the buyer.
D) A firm's manager has motives that sometimes conflict with the interests of shareholders.
E) A trader, who has access to inside information, profits by trading on that information.

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