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Economics
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Economics
Which of the following must be true about a signal that is used to reveal private information in order for the signal to be effective ?
A
It must be “as seen on TV”
Option A
B
It must be free to the signaling party
Option B
It must be costly to the signaling party but less costly to the party with higher-quality product
Correct answer
D
It must be applied to an inexpensive product
Option D
Correct answer: C
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