Dan is trying to sell a high-quality used desktop computer,but all potential buyers are not willing to pay the price that Dan wants.This is likely due to a (an)________ problem.

Question

Quizplus · Accepted Answer

Adverse selection occurs when the buyers have more information about the product than the seller. In this case, the potential buyers may have more information about the market value of used desktop computers than Dan, and therefore are not willing to pay the price he is asking for. This could lead to a situation where only low-quality products are left in the market, and the sellers of high-quality products like Dan may need to lower their prices to find buyers.

Dan Is Trying to Sell a High-Quality Used Desktop Computer,but