In which situation is adverse selection MOST likely to be a problem?
A)buying tomatoes at the local farmers' market
B)hiring a new manager to work the night shift
C)buying a new lawnmower
D)buying a house directly from the previous owner

Question

Quizplus · Accepted Answer

Adverse selection is most likely to be a problem when buying a house directly from the previous owner because the seller has more information about the property's condition than the buyer, potentially leading to the buyer making a poor decision based on incomplete information.

In Which Situation Is Adverse Selection MOST Likely to Be