Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 16, Problem 21CTQ
How do you think the problem of moral hazard might have affected the safety of sports such as football and boxing when safety regulations started requiring that players wear more padding?
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How does the problem of moral hazard affect the safety of sports such as football and boxing when safety regulations started requiring that players wear more padding?
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Chapter 16 Solutions
Principles of Economics 2e
Ch. 16 - For each of the following purchases, say whether...Ch. 16 - Why is there asymmetric information in the labor...Ch. 16 - Why is it difficult to measure health outcomes?Ch. 16 - Why might it be difficult for a buyer and seller...Ch. 16 - What do economists (and used-car dealers) mean by...Ch. 16 - What are some ways a seller of goods might...Ch. 16 - What are some ways a seller of labor (that is,...Ch. 16 - What are some ways that someone looking for a loan...Ch. 16 - What is an insurance premium?Ch. 16 - In an insurance system, would you expect each...
Ch. 16 - What is an actuarially fair insurance policy?Ch. 16 - What is the problem of moral hazard?Ch. 16 - How can moral hazard lead to more costly insurance...Ch. 16 - Define deductibles, copayments, and coinsurance.Ch. 16 - How can deductibles, copayments, and coinsurance...Ch. 16 - What is the key difference between a...Ch. 16 - How might adverse selection make it difficult for...Ch. 16 - What are some of the metrics economists use to...Ch. 16 - You are on the board of directors of a private...Ch. 16 - A website offers a place for people to buy and...Ch. 16 - How do you think the problem of moral hazard might...Ch. 16 - To what sorts of customers would an insurance...Ch. 16 - Using Exercise 16.20, sketch the effects in parts...
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Similar questions
- Which of the following is an example of moral hazard? Group of answer choices A. Reckless drivers are the ones most likely to buy automobile insurance. b. Retail stores located in high-crime areas tend to buy theft insurance more often than stores located in low-crime areas. C. Drivers who have many accidents prefer to buy cars with air bags. D. Employees recently covered by the company health plan start going to the doctor every time they get a cold. E. Company divisions try to improve profitability at each other's expense.arrow_forward"Clothes make the man.” a. What do clothes and grooming tell about a person? b. Can a person judge by his appearance?arrow_forwardRobert decides to start working for the local ridesharing company. He has a large 12-passenger van and thinks he will be in big demand at the airport. He tells his personal car insurance company that he is driving for a ridesharing company, and he needs some additional insurance. He is denied additional coverage. Why? There is no such thing as ridesharing insurance. He lives in a state that doesn’t offer ridesharing insurance. The city he lives in is too small for him to qualify for ridesharing insurance. Many insurance companies will not insure high-occupancy vehicles under their ridesharing policies.arrow_forward
- You are on the board of directors of a private high school, which is hiring new tenth-grade science teachers. As you think about hiring someone for a job, what are some mechanisms you might use to overcome the problem of imperfect information?arrow_forwardThere is a new trendy cellphone. Almost everyone enjoys it. Would you say that the bandwagon effect on consumers has increased?arrow_forwardIf people get higher pay from insurance than their premiums. Will this increase or decrease the death rate of average persons? Is this an example of moral hazard or adverse seletion? How will an insurance company deal with these problems?arrow_forward
- Why would club goods not have a free rider problem?arrow_forwardStudents will be able to understand what whistle-blowing is and when employees are justified in blowing the whistle. Research a company where illegal actions (within the last 5 years) caused an employee to whistle blow publicly. What was the situation and who was being harmed? Was the whistle blowing morally justified using the four points of moral justification on page 345? What was the end result of the information going public? The organization is doing (or will do) something that seriously harms others. The employee has tried and failed to resolve the problem internally. Reporting the problem publicly will probably stop or prevent the harm. The harm is serious enough to justify the probable costs of disclosure to the whistle-blower and others.48 Only after each of these conditions has been met should the whistle-blower go public. Use 2 journal articles.arrow_forwardUsing an appropriate graph explain how tax exemption affects insurance coverage.arrow_forward
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