1. When an auto insurance company is screening, it is A. attempting to keep its private information private. B. marketing its policies to customers. C. ignoring the possibility of moral hazard in order to minimize adverse selection. D. trying to determine if a driver is an aggressive driver or a safe driver. E. making its private information public.
1. When an auto insurance company is screening, it is
A. attempting to keep its private information private.
B. marketing its policies to customers.
C. ignoring the possibility of moral hazard in order to minimize adverse selection.
D. trying to determine if a driver is an aggressive driver or a safe driver.
E. making its private information public.
2. In the market for health care services, Health Maintenance Organizations
A. help overcome adverse selection by enrolling only healthy clients.
B. exist to insure people with preexisting medical conditions.
C. overprovide medical care and thereby result in increased costs.
D. help overcome moral hazard by monitoring the quality of the service.
E. None of the above answers are correct
3. Moral hazard in the market for healthcare services leads
Question content area bottom
Part 1
A.
to providers over treating patients..
B.
to healthy people not buying health insurance.
C.
patients to adopt healthy life styles.
D.
to all people buying health insurance.
E.a separating equilibrium.
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