When buyers cannot tell whether a product is high or low quality before making the purchase
A)both high-quality and low-quality units of the product will sell for the same price.
B)high-quality and low-quality units of the product will sell at different prices.
C)sellers must let the buyers know the quality of each unit of the product.
D)buyers must let sellers know the quality of the unit that they desire to buy.

Question

Quizplus · Accepted Answer

When buyers cannot tell whether a product is high or low quality before making the purchase, they are likely to assume that all products are of similar quality and will be willing to pay the same price for both high-quality and low-quality units. Therefore, both high-quality and low-quality units of the product will sell for the same price.

When Buyers Cannot Tell Whether a Product Is High or Low