The Problem of Adverse Selection in Health Insurance Leads to a Situation

question 64

Multiple Choice

The problem of adverse selection in health insurance leads to a situation in which:

• A) health insurance covers inappropriate items for the population it serves.
• B) overinsurance of the premium-paying population occurs.
• C) underinsurance of the premium-paying population occurs.
• D) the percentage of the premium-paying population that is healthy rises, squeezing unhealthy individuals out of the market.
• E) the percentage of the premium-paying population that is unhealthy rises, squeezing healthy individuals out of the market.

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Definitions:

Work-Centre Master File

A database or file that contains detailed information about each work center in a manufacturing facility, including capabilities, capacities, and scheduling data.

Efficiency

The ratio of the output obtained to the input used in the production process, measuring how well resources are utilized.

Gantt Charts

A type of bar chart that illustrates a project schedule, showing the start and finish dates of the various elements of a project.