Conspicuous consumption is a more effective signal of ability for people who:
A)live in large cities instead of small towns.
B)already have well-established reputations.
C)live in small towns instead of large cities.
D)don't understand moral hazard.

Question

Quizplus · Accepted Answer

In small towns, people are more likely to know each other, so there is less uncertainty about people's ability.

Conspicuous Consumption Is a More Effective Signal of Ability for People