Asymmetric information is a phenomenon when both parties an unequal level of knowledge regarding the matter involved in the transaction. This is very common in any field. For example, a fruit seller normally knows much about the fruits’ species than a buyer and charge more rate for the fruits being sold. A builder knows better about the structure of the building and how much will it cost than the person who hired him.
Information asymmetry is a natural economic phenomenon and it is almost always present in every transaction. An advantage of information asymmetry is that the parties are continuously trying to acquire more knowledge about new things and this leads to improvement in productivity.
However, due to the high amount of information asymmetry between two parties, which means if one party knows very much and the other party knows very little, there can be a dispute between the parties due to deception either intentional or unintentional.
1.1. There is asymmetric information in the used-
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