CARFAX is a company that compiles and sells histories of used cars. CARFAX reduces the
A) number of cars exchanged in the used car market.
B) information asymmetry in the used car market.
C) number of used cars offered for sale in the market.
D) cost of used cars in the market.

Question

Quizplus · Accepted Answer

CARFAX reduces the information asymmetry in the used car market by providing buyers with the vehicle's history including accidents, odometer readings, and previous owners. This information helps buyers make an informed decision and reduces the risk of purchasing a faulty or potentially dangerous vehicle. It does not have a direct impact on the other options listed.

CARFAX Is a Company That Compiles and Sells Histories of Used