Final answer:
In the Easton vs Strassburger case, real estate licensees must disclose all known defects and those that should be known, mirroring measures used in the sale of goods like offering guarantees and warrantees to reassure buyers of product quality.
Step-by-step explanation:
The Easton vs Strassburger case established that real estate licensees have a legal duty to disclose to prospective buyers not just the known defects of a property, but also those defects that should be reasonably known upon diligent inspection. In the context of this principle, a real estate licensee would be obligated to provide a list of known defects and those that should be known (Option B). This is particularly relevant when a property has issues that aren't immediately visible or obvious, such as structural problems or a history of serious damage.
When considering the sale of goods with imperfect information, mechanisms to reduce the risk can include the seller providing guarantees, warrantees, and service contracts. In the real estate market, thorough home inspections are analogous to these mechanisms, offering buyers a layer of security. Reputational factors can also play a critical role, with sellers who have a track record of honesty and transparency more likely to reassure buyers in the face of imperfect information.