Written by the Fiveable Content Team • Last updated August 2025
Verified for the 2027 exam
Verified for the 2027 exam•Written by the Fiveable Content Team • Last updated August 2025
Definition
A situation where one party in a transaction has more or better information than the other party, leading to market inefficiency and potential market failure.
AP course connection
Topic 6.1: 6.1 Socially Efficient and Inefficient Market Outcomes