Meaning of asymmetric information: Asymmetric
information refers to the situation where information is not
equally distributed between the parties involved in economic
transactions. One party has relatively more and accurate
information. Thus, it can be used for disadvantage of other
party.
Asymmetric information, Demand and supply:
asymmetric information renders the economic system inefficient and
economy moves towards the inefficient outcomes. While the demand
and supply seek to achieve the economic efficiency by producing
optimal output. Hence, presence of asymmetric information would not
help to reach the efficient outcome.