While teaching the concepts of asymmetric information, a professor asked his students for examples of adverse selection

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While Teaching The Concepts Of Asymmetric Information A Professor Asked His Students For Examples Of Adverse Selection 1 (21.88 KiB) Viewed 14 times

While teaching the concepts of asymmetric information, a professor asked his students for examples of adverse selection or moral hazard in marriage. Which of the following examples most accurately describes adverse selection and moral hazard in marriage? O A. Adverse selection because the wife's pre-wedding pleasant demeanor continues after marriage. Moral hazard because the husband keeps up his appearance after the wedding. O B. Adverse selection because both the husband and wife's alcoholism continues unabated after the wedding leading to an ugly divorce. O C. Moral hazard and adverse selection because both husband and wife are now unhappy in marriage. O D. Adverse selection because the husband's secret alcoholism comes out after the wedding. Moral hazard because a spouse lets their appearance go after marriage.