Answer: The presence of asymmetric information
Explanation: In simple words, asymmetric information refers to the situation when one party to a contract have extra information regarding a subject than the other party of the contract.
Asymmetric information creates the potential of misconduct from the leading party as they can easily cheat the other party by concealing that important information.
In the given case, Mr. Smith was aware that his laptop is not working properly but still he sold its to a customer who was not aware of it. Thus, we can conclude that the correct option is C.
Answer:
It is an economic condition that occurs when a country is importing more goods than it is exporting.
Explanation:
Answer:
b. mortgage backed securities diversify credit risk for the investor.
Explanation:
An investor, such as a bank, may prefer to invest in securities backed by a pool of mortgages purchased in the secondary market rather than in an equal dollar amount of mortgage loans because <u>mortgage backed securities diversify credit risk for the investor.</u>
In Mortgage Backed Securities, credit risk is diversified as there are many borrowers and investors between whom credit risk diversifies. So that makes investor such as bank prefer the option.
Answer:
The correct answer is C: off-peak pricing
Explanation:
Off-peak pricing is a way of stimulating demand by charging less than "normal" in periods of low demand. In this exercise, it changes the price differentiating by weekdays and time. It expects to attract costumers to days and hours of low demand. The opposite is Peak pricing which is a way of congestion pricing where customers pay an additional fee during periods of high demand.
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