The seller of an existing house claims that it is in great shape, and he is offering a 2-year warranty on the house. His statements about the quality of his house are likely to be:
A) credible even in the absence of a warranty.
B) overstated.
C) true because offering a warranty is a costly-to-fake signal.
D) untrue because otherwise he would not offer the warranty.
Correct Answer:
Verified
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