How do economists explain the value firms and consumers place on brand names?
A) Brand names show that firms can easily manipulate consumers.
B) Brand names are a way firms can provide information about quality to consumers.
C) Brand names are a way of turning private goods into public goods, increasing their value to both seller and buyer.
D) Brand names are an example of adverse selection, by which producers advertise the options to consumers.

Question

Quizplus · Accepted Answer

Brand names help convey information about the quality and reputation of a product, reducing uncertainty for consumers and allowing them to make informed purchasing decisions.

How Do Economists Explain the Value Firms and Consumers Place