Final answer:
It's false that a verbal offer can simplify and speed up the home buying process, as a written offer ensures clarity and legality. Imperfect information can make it difficult for a buyer and seller to agree on a price, and buyers might pay more than the equilibrium price due to various factors.
Step-by-step explanation:
The statement that you should first give a verbal offer to speed up the home buying process is false. In reality, the process is more complex and typically requires written and official documentation from the outset to ensure clarity and legality of the transaction. A verbal offer might be a quick way to gauge interest, but it lacks the weight and commitment of a formal offer and can lead to misunderstandings or disputes later on.
When it comes to agreeing on a price, imperfect information can make it difficult for buyers and sellers to find common ground. Buyers may not have all the data on the current market conditions or the condition of the property, while sellers might overestimate their property's value based on emotional attachment or other biases. This gap in information can hinder reaching an agreement that reflects the true value of the property.
Additionally, the notion that no buyer would be willing to pay more than the equilibrium price in the goods market is false. There can be various reasons for a buyer to pay above the equilibrium price such as specific preferences, urgent needs, perceived value, or competitive markets where bidding wars might inflate prices.