Which of the following is a means of eliminating the undesirable effects of adverse selection?

Question

Quizplus · Accepted Answer

Both a long-term relationship and writing a contract to guarantee quality are means of eliminating the undesirable effects of adverse selection. A long-term relationship allows the parties to develop trust over time, while a contract can ensure that the quality of the product or service is guaranteed. By doing so, the risk of adverse selection is reduced, and both parties can benefit from the transaction.

Which of the Following Is a Means of Eliminating the Undesirable