By providing reliable information about a product or resource so that another party can make an informed purchase or sale decision, _____ allows the firm to charge a higher price.

Question

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Signaling allows a firm to communicate its product's quality or value to potential buyers, enabling it to justify and often charge a higher price. This is because signaling helps reduce information asymmetry between the seller and the buyer, making the buyer more confident in the purchase.

By Providing Reliable Information About a Product or Resource So