A lender usually knows less about the creditworthiness of a borrower than the borrower does.This is an example of:

Name: A lender usually knows less about the creditworthiness of a borrower than the borrower does.This is an example of:
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Information asymmetry occurs when one party in a transaction has more or better information than the other party. In this case, the borrower has more information about their own creditworthiness than the lender does, which creates information asymmetry.

A Lender Usually Knows Less About the Creditworthiness of a Borrower