Adverse selection arises in the market for health insurance because Moral hazard arises in the market for health insurance because OA. for many people, the price of health insurance is beyond their ability to pay for it; the marginal social benefit of healthcare exceeds the marginal benefit perceived by its consumers OB. people optimistically underestimate the health risks that they face; people take too short a view of the benefits of healthcare OC. O D. some of the healthiest people choose to not buy insurance; once insured, a person has less incentive to adopt a healthy lifestyle once insured, a person has less incentive to adopt a healthy lifestyle; some of the healthiest people choose to not buy insurance;

Adverse selection arises in the market for health insurance because Moral hazard arises in the market for health insurance because OA. for many people, the price of health insurance is beyond their ability to pay for it; the marginal social benefit of healthcare exceeds the marginal benefit perceived by its consumers OB. people optimistically underestimate the health risks that they face; people take too short a view of the benefits of healthcare OC. O D. some of the healthiest people choose to not buy insurance; once insured, a person has less incentive to adopt a healthy lifestyle once insured, a person has less incentive to adopt a healthy lifestyle; some of the healthiest people choose to not buy insurance;

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Adverse selection arises in the market for health insurance because
Moral hazard arises in the market for health insurance because
OA. for many people, the price of health insurance is beyond their ability to pay for it;
the marginal social benefit of healthcare exceeds the marginal benefit perceived by its consumers
OB. people optimistically underestimate the health risks that they face;
people take too short a view of the benefits of healthcare
OC.
O D.
some of the healthiest people choose to not buy insurance;
once insured, a person has less incentive to adopt a healthy lifestyle
once insured, a person has less incentive to adopt a healthy lifestyle;
some of the healthiest people choose to not buy insurance;

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