Relating to the Economics in Practice on page 360: The smart phone app which allows skiers at a slope to report weather conditions to others could be considered a form of
A) moral hazard.
B) market signaling.
C) asymmetric information.
D) risk-loving.

Question

Quizplus · Accepted Answer

The smart phone app that allows skiers to report weather conditions to others is an example of market signaling because it provides information to other skiers about the conditions on the slope. Market signaling is when one party provides information to another party in order to influence their decision making. In this case, the skiers who report the weather conditions are signaling to other skiers whether or not it is safe to ski on the slope. Moral hazard, asymmetric information, and risk-loving are not applicable in this situation.

Relating to the Economics in Practice on Page 360: the Smart