Which of the following arguments is based on the concept of adverse selection? a. The U.S. Military needs higher pay to attract the best personnel. b. Private medical insurance companies seek to exclude those most likely to need healthcare. c. Only the national government can successfully conduct macroeconomic stabilization policies. d. Mosquito abatement is a public good.

Which of the following arguments is based on the concept of adverse selection? a. The U.S. Military needs higher pay to attract the best personnel. b. Private medical insurance companies seek to exclude those most likely to need healthcare. c. Only the national government can successfully conduct macroeconomic stabilization policies. d. Mosquito abatement is a public good.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter19: The Problem Of Adverse Selection

Section: Chapter Questions

Problem 6MC

See similar textbooks

Similar questions

Economics Explain how an “individual mandate," where every resident of a country is required by law to purchase health insurance might affect the cost of healthcare. Which specific source of market failure is addressed by such a mandate? Explain your answer.
The National Flood Insurance Program (NFIP) provides flood insurance for homeowners and small businesses. The policyholders pay just 10% of the actual cost of flood insurance. When such highly-subsidized insurance is available, people are more likely to build homes in areas subject to sever flood damage. What is this behavior is called? a. Negative externality b. Positive externality c. Adverse selection d. Moral hazard
For each of the cases below, describe the type of entry barrier that appears to be most relevant. Which of the following describes the type of entry barrier faced for a patented blood pressure medication? A. There is a natural entry barrier for a patented blood pressure medication because entry into the market has been limited through government action. B. There is a created entry barrier for a patented blood pressure medication because entry into the market has been limited through limited access to key natural resources. C. There is a created entry barrier for a patented blood pressure medication because entry into the market has been limited through government action. D. There is a natural entry barrier for a patented blood pressure medication because entry into the market has been limited through price cutting.
True or false 1. A perceived disadvantage of Rawls's social justice theory is that it does not consider the fact that people would not want to maximize benefits for the least advantaged persons 2. Ethical relativism is a moral theory which holds that individuals must decide what is ethical based on their own feelings about what is right and wrong. 3. Utilitarianism is a moral theory that chooses the greatest good to society but does not mean the greatest good for the greatest number of people. 4. According to Rawls's “social justice” theory, a person who is in a state of "veil of ignorance" is best fit to select the fairest possible ethical principles. Please help, & thank you!
Explain a main point in Maki Naro's "Vaccines Work. Here Are the Facts" for rhetorical analysis essay
Which of the following is a provision of the Patient Protection and Affordable Care Act? Group of answer choices Insurance companies may not legally deny coverage to anyone on the basis of a preexisting medical condition. Every firm must purchase health insurance for their employees or face a $2,000 fine per employee. Every individual must purchase their own health insurance for themselves and their dependents or pay a fine. Adult children of parents with employer-provided health insurance can remain covered by their parents' insurance through age 35.
While the individual mandate clause in the Affordable Care Act (also known as, Obamacare) was still in effect, which market failure in the market for health insurance did it help to reduce? Group of answer choices A.) Increasing Returns to Scale. B.) Moral Hazard. C.) Adverse Selection. D.) Barriers to Entry. E.) Externalities.
Large differences regarding health policy exist between those on the political left and those on the political right. Which of the following cost-containment approaches would those on the right oppose? A. Markets and price competition B. Individual choice of health plans, including health savings accounts C. Government negotiation with pharmaceutical companies D. Elimination of state mandates
During the time of a pandemic and the existence of a highly contagious corona-virus, many scientists recommended wearing a mask. Let's assume that wearing a mask can limit the spread of the virus. Is wearing a mask an externality? Positive or negative? How about not wearing a mask? Explain your answers.
Part 1: Describe a public leader (historical or modern) who you feel practices many or all of the seven habits of an ethical leader. Be sure to tell us who the leader is. Part 2: Describe a public leader (historical or modern) who you feel does not practice many or any of the seven habits of an ethical leader. Be sure to tell us who the leader is?
There are 1,000 families in a neighborhood that is affected by noise pollution from a local factory. The noise level is within legal limits, but could be reduced further if the company spent $5,000 on technological improvements. The company agrees to make these improvements if the affected families contribute the $5,000. A committee starts to collect donations to pay for the improvements. Which of the following is most likely to occur? A. Because there are relatively few families involved and the individual contribution is so small, all families will voluntarily contribute. B. Because each individual contribution is so small and individuals will benefit from the reduction in noise whether they contribute or not, most people will not contribute and the firm will not make the improvements. C. Even if the families raise the $5,000, the firm will not reduce its noise pollution because it is within legal limits. D. The courts will force the firm to spend the $5,000 regardless of whether or…
Which of the following best describes the moral hazard problem associated with means-tested redistribution programs? A.People may change their behavior to be eligible for the program. B.Eligible people may not sign up for the program due to negative stigma. C.Programs are costly for society. D.Only high risk individuals sign up for programs.