Which of the Following Is a Negative Consequence to Having

question 24

Multiple Choice

Which of the following is a negative consequence to having insurance companies exist in a society?

• A) The asymmetric problem is reduced by insuring large groups of people.
• B) They are able to pool risks and give the sick the same access to medical care as the healthy.
• C) When they have insurance,individuals will consume more medical care than if they have to pay the full cost for care.
• D) When they have insurance,individuals will consume less medical care than if they have to pay the full cost for care.
• E) By insuring large groups of people,the asymmetric problem is increased.

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Definitions:

Demand

The extent of a good or service that patrons are inclined and have the ability to secure at different price ranges over a set period.

Substitute

A product or service that can be used in place of another, offering consumers an alternative choice.

Equilibrium Price

The price point where market supply matches market demand, leading to a balanced market condition.

Pens

Writing instruments that use ink to leave a mark on surfaces, typically used for handwriting.