How Does the Federal Government Avoid the Asymmetric Information Problem

question 16

Multiple Choice

How does the federal government avoid the asymmetric information problem associated with providing health care to people over 65 years of age?

• A) Health care is standardized and is the same for all people over 65 years of age.
• B) Health insurers rely on the reputation of the covered individuals.
• C) Participation in the Medicare program is mandatory for all people over 65 years of age.
• D) Health information about people enrolled in the Medicare program is publically available.

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Definitions:

Communication Channel

The medium through which information is transmitted from a sender to a receiver, such as email, phone, or face-to-face meetings.

Oral

Involving spoken communication or examination.

Written

Communication or documentation that is expressed in written form, including reports, emails, and memos.

Non-verbal

Communication that occurs through body movements, facial expressions, and other physical gestures rather than words.