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Recall the Application About the Free-Agent Market for Professional Baseball

Question 36

Multiple Choice

Recall the Application about the free-agent market for professional baseball pitchers to answer the following question(s) .
-Recall the Application.Assume professional pitchers who are free agents and are more likely to get injured switch teams more often than those who are less likely to get injured.How is this situation explained by asymmetric information?


A) The coaches, physicians, and trainers from the player's original team have interacted with the player for years and know if player is likely to suffer from injuries. The new team has the same information because they can check the league records.
B) The coaches, physicians, and trainers from the player's original team have interacted with the player on a daily basis for years and know if player is likely to suffer from injuries. The new team has less information because they have not interacted with the player daily.
C) The coaches, physicians, and trainers from the player's new team have not interacted with the player on a daily basis for years and don't know if player is likely to suffer from injuries but have the league records that contain all the information that the new team needs to determine if the pitcher is a lemon or plum.
D) There is a perfect amount of information for the pitcher and the new team.

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