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.

Q: For each of the following kinds of insurance, give anexample of behavior that reflects moral hazard…

A: Moral hazard is a situation in which a person involves in some risky event by knowing that his/her…

Q: Suppose an individual saves as precaution against adverse events, like unemployment. This is an…

A: The income earned by an individual is either spent or saved. The risk-averse individual likes to…

Q: A deductible reduces ________ in exactly the same way as ________.   Question 10 options:   a)…

A: When talking about deductibles, it is the amount of money that an individual pays in advance to get…

Q: Economics Use the following information to determine the costs to you and/or to the insurance…

A: . You attend your doctor for a Routine Physical $250 for the extended office visit and $200 for the…

Q: Which of the following represents an effort to correct for an adverse selection problem? a. The…

A: When talking about adverse selection, it is one of the form of asymmetric information, which causes…

Q: 31. You may be unwilling to buy a used car because you suspect the last owner found out the car was…

A: The lemons dilemma refers to challenges that develop when the buyer and seller have unequal…

Q: If people get higher pay for insurance than their premium will this increase or decrease the death…

A: If people get higher pay for insurance than their actual premium, they will be more prone to risk…

Q: George Akerloff focused the market for used cars and discussed an issue later generally called the…

A: In the year of 1970, a behavioral economist, George Akerloff published a paper "The Market for…

Q: True/False: If a health insurance company could somehow monitor everything a customer does and…

A: We will answer the first question since the exact one was not specified. Please submit a new…

Q: Which of the following is an example of moral hazard? Group of answer choices High-quality products…

A: A moral hazard is a care to be done by others to protect us. Moral hazard a wealth-creating…

Q: In the context of asymmetric information, adverse selection and moral hazard, how does market…

A: The market does not perform well in the case, either there is the provisioning of public goods or…

Q: How does the problem of moral hazard affect the safety of sports such as football and boxing when…

A: A policy represents a contract in which an individual or corporation receives financial protection…

Q: What is the true cost of going to the doctor? options:   The amount you pay minus the amount your…

A: In economics true cost include explicit costs and implicit costs or it is the opportunity cost of…

Q: ce in the sense of socializing risk? a. A dental insurance policy that pays for two check-ups a…

A: * ANSWER :-

Q: Imagine a market for used computers. There are two types of computers: good and bad. Also imagine…

A: Because buyer thinks that computer would be of bad quality.

Q: How do you think the problem of moral hazard might have affected the safety of sports such as…

A: Asymmetric information refers to how the borrowers have better information about their ability to…

Q: Kenji sees a classified ad from Lucia offering a used digital camera for $30. On the opposite page,…

A: Kenji values the digital camera at $300 as long as it works. The available cameras are the new one…

Q: Briefly explain what it means for information to be asymmetric. a. What is Moral Hazard? b.…

A: Asymmetric information is unequal, unbalanced, or lopsided information, as the term implies. It's…

Q: What is moral hazard?

A: Asymmetric information arises in the market, where one of the parties involved in the transaction…

Q: RAND study, two plans had full coverage for spending within the hospital, but one had a $150…

A: The RAND concentrate on tried whether hospital c and outpatient care are supplements or substitutes.…

Q: For each of the following kinds of insurance, give anexample of behavior that can be called moral…

A: Insurance is a tool that individuals and businesses use to protect themselves from the financial…

Q: What are moral hazard and adverse selection? How are they similar, how are they different? What…

A: Asymmetric information refers to the situation when there is incomplete information or knowledge in…

Q: The principal of a school hires Daniel to teach eighth grade students. One goal the principal has is…

A: Economics is used to study how scarce resources on earth can be utilised efficiently to satisfy…

Q: What is the concensus of how economists believe the government should deal with occurences of moral…

A: Numerous market inefficiencies, unethical practises, and a lack of transparency in the financial…

Q: 5. Candace was eating French fries and talking on the phone as she sped through traffic on the way…

A: Here, the given situation explains the careless behavior of Candance at the road due to which she…

Q: Match the situation with its most appropriate label. Use each answer only once. Only sick people…

A: Asymmetric information refers to the market condition where buyers and sellers are not equally…

Q: 3. Warranties in the used car market the problem of private thereby causing the price of information…

A: Since , we know that in the lemon market problem the bad quality cars drives out the goods quality…

Q: . Indicate which of the following describes a moral hazard problem and which describes adverse…

A: In economics, an adverse selection refers to the situation when any of the parties has more…

Q: George has a life insurance policy that pays hisfamily $1 million if he dies. As a result, he…

A: This is an example of moral hazard because in the situation of moral hazard an individual has an…

Q: How is the moral hazard problem relevant to the health care market?

A: Moral hazard- When a party to a contract can take chances without having to bear consequences, moral…

Q: Which of the following is the best example of a moral hazard problem?   Question 25 options:   a)…

A: When talking about moral hazard, it is the situation that arises after a transaction is made between…

Q: If people get higher pay from insurance than their premiums. Will this increase or decrease the…

A: Moral Hazard:Moral hazard is a situation, which arises when a person an insured person takes greater…

Q: George Akerloff focused the market for used cars and discussed an issue later generally called the…

A: Lemons problem: It refers to the problem which is connected with the defective cars. This problem…

Q: Before selling anyone a health insurance policy, theKramer Insurance Company requires that…

A: The ‘market failure’ refers to the situation when goods & services are distributed…

Q: 7. John Nyman (2003) advanced an alternative reason why people desire medical insurance coverage. A.…

A: Insurance  Insurance is the service that is provided by the Insurer(Insurance provider) to…

Q: Mary is an 18-year-old student who recently bought a used car Mary is looking to buy car insurance…

A: When one party has more information than the other, there is always asymmetric information, which…

Moral Hazard

The moral is a person's behavior towards himself /herself, society, organization, and others. Hazard is something that is happening and is not good. A person may be morally good or bad. It depends on his attitude, ethics, integrity, and values. A person may have the highest reverence for money to that for the truth. In this case, the person may lie and it is said that the person is morally bad.