Which of the folowing reresents an efot to corec for an adverse selection problem?O a An employer requires al employees to submit to dru testing.Ob. The govemment subsidises the development of cofriendl proucion methods.Oc. An employer reguire al mployes to purchase employer-sponsored dental insurance.O d. The govermment imposes a tax on a factory emiting a toxicsubstance.O e. The govemment subsidses the consumpton of ftness actvite.

Adverse Selection is the market process involving buyers and sellers who are able to use their…

Which of the folowing egresents an efot to orectfr an adverse selecton problem? Oa An employer regure al mployes to uomit o du tsing. Ob. The govemment subsidses the development of ecofiendy producton methods. Oc.An mployer reuie al emloyees o puchase employer-sponsored dental insuance. Od. The govement imposes a tax on a factory emiting a toxic sbstance. O e. The govermment subsidises the consumption of finesatites.

Which of the folowing egresents an efot to orectfr an adverse selecton problem? Oa An employer regure al mployes to uomit o du tsing. Ob. The govemment subsidses the development of ecofiendy producton methods. Oc.An mployer reuie al emloyees o puchase employer-sponsored dental insuance. Od. The govement imposes a tax on a factory emiting a toxic sbstance. O e. The govermment subsidises the consumption of finesatites.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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For each of the following kinds of insurance, give anexample of behavior that can be called moral /raumtand anotJ,cr example of behavior that can be calledadverse selection.a. health insuranceb. car insurancec. tile insurance
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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;