Anita is selling a sofa, but due to _____, she is unable to get the price she wants.

Question

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Adverse selection occurs when one party in a transaction has more or better information than the other party, typically leading to a situation where the party with less information is at a disadvantage. In the context of selling a sofa, if potential buyers assume the sofa might have hidden defects or reasons for the sale that they are not aware of, they may be unwilling to pay a higher price, fearing they are making a bad deal. This is a classic example of adverse selection, where the seller's inability to convey the true quality of the sofa leads to receiving lower offers.

Anita Is Selling a Sofa, but Due to _____, She