Adverse Selection in Economics: Definition & Examples


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A situation where one party knows information that the other party does not is called:

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1. When undesired results occur on the basis of asymmetric information, what has happened?

2. What kind of products might be selected due to one party not having all of the information?

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About This Quiz & Worksheet

This quiz and worksheet will assess your understanding of adverse selections in economics. Topics you will need to grasp include what asymmetric information is, and what impact it can have in economic situations.

Quiz & Worksheet Goals

Use these assessment tools to:

  • Address undesired results with asymmetric information
  • Identify products that might be selected with only partial information
  • Know consumer habits in relation to adverse selections
  • Recognize adverse selection examples

Skills Practiced

This worksheet and quiz let you practice the following skills:

  • Critical thinking - apply relevant concepts to examine information about adverse selection
  • Interpreting information - verify that you can read information regarding asymmetric information and interpret it correctly
  • Knowledge application - use your knowledge to answer questions about consumer habits

Additional Learning

To learn more about adverse selection, review this lesson on Adverse Selection in Economics: Definition & Examples. The lesson covers these objectives:

  • Define adverse selection
  • Identify examples of adverse selections in economics