Which of the following is not true of adverse selection?
A) It can result when one of the parties to a transaction has little information about the quality of the goods involved.
B) It can cause the quality of goods traded to fall, if quality detection costs are high.
C) It can be a difficult problem to overcome, because it is not individually rational for the transactor with the superior information to provide a truthful and complete disclosure.
D) All of the above are true.
Correct Answer:
Verified
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