That most used cars are sold by intermediaries (i.e. ,used car dealers)provides evidence that these intermediaries
A)have been afforded special government treatment,since used car dealers do not provide information that is valued by consumers of used cars.
B)are able to prevent potential competitors from free-riding off the information that they provide.
C)have failed to solve adverse selection problems in this market because "lemons" continue to be traded.
D)have solved the moral hazard problem by providing valuable information to their customers.

Question

Quizplus · Accepted Answer

Intermediaries like used car dealers can prevent free-riding by controlling the information they provide, which is valuable to consumers and differentiates them from competitors.

That Most Used Cars Are Sold by Intermediaries (I