Why soft selling can serve as a successful signal

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"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 oer to them the product in exchange for 50% of their cost savings. Describe the (i) information asymmetry, (ii) the adverse selection problem, and (iii) why soft selling can serve as a successful signal of the quality or usefulness of the new accounting system.

Reference no: EM13153392

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