Question

Information asymmetry refers to
a. the tendency of a person who is imperfectly monitored to engage in dishonest or otherwise undesirable behavior.
b. the tendency for the mix of unobserved attributes to become undesirable from the standpoint of an uninformed party.
c. an action taken by an informed party to reveal private information to an uninformed party.
d. a difference in access to relevant knowledge.

Answer 1

Answer:

d. a difference in access to relevant knowledge.

Explanation:

"The theory of asymmetric information was developed in the 1970s and 1980s as a plausible explanation for common phenomena that mainstream general equilibrium economics couldn't explain. In simple terms, the theory proposes that an imbalance of information between buyers and sellers can lead to inefficient outcomes in certain markets."

Reference: Ross, Sean. “The Theory of Asymmetric Information in Economics.” Investopedia, Investopedia, 4 Oct. 2019