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A costly signal is a behavior or attribute that conveys information about an individual's quality or intentions, which is difficult or expensive to fake. This concept is often used in economics and evolutionary Biology to explain how reliable information is communicated in situations of asymmetric information. For example, a peacock's elaborate tail serves as a costly signal of fitness, as only healthy males can afford to produce and maintain such a display. In business, companies may engage in costly signaling through investments in high-quality customer service to indicate their commitment to consumer satisfaction.

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1mo ago

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