Sellers will opt out of markets in which
A) there are signiﬁcant negative externalities.
B) standardized products exist.
C) there are only foreign buyers.
D) information about buyers is inadequate which allows some buyers to consequently impose high costs on the sellers.

Question

Quizplus · Accepted Answer

When information about buyers is inadequate, sellers cannot gauge the true intentions of buyers and may fall prey to buyers who might impose high costs on them. This may result in sellers opting out of such markets.

Sellers Will Opt Out of Markets in Which