If homes owned by real estate agents stay on the market longer and sell for higher prices than homes owned by people who hire real estate agents,this may be evidence of:

Question

Quizplus · Accepted Answer

This scenario is indicative of moral hazard because it suggests that real estate agents, who have more information and control over the sale process, may behave differently when selling their own homes compared to when they are selling homes on behalf of their clients. This difference in behavior, driven by the agents' unique position and incentives, can lead to outcomes that are more favorable to them (longer listing times for higher prices) than the outcomes for their clients.

If Homes Owned by Real Estate Agents Stay on the Market