Explain “soft selling” and adverse selection

Reference no: EM13196197

“Soft Selling” and Adverse Selection
Soft selling occurs when a buyer is skeptical of the quality or usefulness of a product or service.
For example, suppose you’re trying to sell a company a new accounting system that will reduce
costs by 10%. Instead of asking for a price, you offer to give them the product in exchange for
50% of their cost savings.

Describe the information asymmetry, the adverse selection problem,
and why soft selling is a successful signal.

Reference no: EM13196197

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