The tendency for people to enter into agreements in which they can use their private information to their own advantage and to the disadvantage of the less informed party is known as
A) adverse selection
B) moral hazard.
C) the market for oranges.
D) a signal.

Question

Quizplus · Accepted Answer

Adverse selection occurs when one party in a transaction has more information than the other, often leading to the more informed party taking advantage of the situation, to the detriment of the less informed party.

The Tendency for People to Enter into Agreements in Which