Asked by Johnson Jacques on Sep 24, 2024
Verified
Screening is
A) actions by the informed party to reveal her true risks
B) actions by the informed party to conceal her true risks
C) actions by the uninformed party to uncover the true risks
D) actions by the uninformed party to conceal the true risks
Screening
The process of evaluating or assessing something for a specific purpose, such as identifying suitable candidates for a job or detecting diseases.
True Risks
Genuine uncertainties and potential for loss that are inherent in decisions or activities, without assurance of outcomes.
- Highlight the distinctions between the mechanisms utilized for signaling and screening purposes.
Verified Answer
YH
yolanda horton1 day ago
Final Answer :
C
Explanation :
Screening is a strategy used by the uninformed party to uncover or reveal the true risks or qualities of the other party involved in a transaction or interaction. This is often used in contexts like insurance, where the insurer (uninformed party) might use various methods to assess the risk profile of the insuree (informed party).
Learning Objectives
- Highlight the distinctions between the mechanisms utilized for signaling and screening purposes.