Nicole wants to avoid buying a car with hidden defects. She takes a car she would like to buy to her mechanic before she purchases it. This is known as

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Screening refers to the process of gathering information about a product or service before making a purchase in order to avoid potential risks and hidden defects. In this case, Nicole is screening the car by taking it to her mechanic before buying it. Signalling, moral hazard, and adverse selection are all related to the risks and uncertainties in transactions, but do not accurately describe the action Nicole is taking.

Nicole Wants to Avoid Buying a Car with Hidden Defects