EBK PRINCIPLES OF MICROECONOMICS
12th Edition
ISBN: 9780134069180
Author: Oster
Publisher: YUZU
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Chapter 17, Problem 2.1P
To determine
How imperfect information problems such as adverse selection and moral hazard might affect various markets or situations.
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Suppose there is a new preventative treatment for a common disease. If you take the preventative
treatment, it reduces the average amount of time you spend sick by 10%. The optimal combination of
Z (home goods) and H (health goods).
both may increase
both may increase or one may stay the same while the other increases.
both may decrease
H may increase; Z may not change
Z may increase; H may decrease
In the Bismarck system,.
may arise.
neither selection
both adverse and risk selection
☑
adverse selection
risk selection
Pls fill out/explain to me these notes and explanations, thanks
Chapter 17 Solutions
EBK PRINCIPLES OF MICROECONOMICS
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