If Fewer Families Choose to Purchase Dental Insurance Due to Increasing

question 169

Multiple Choice

If fewer families choose to purchase dental insurance due to increasing insurance premiums,one of the reasons why the remaining insured families tend to have more than the average number of visits to the dentist is that

• A) the frequency of dental problems in the general population falls.
• B) the remaining insured families tend to have a lower-than-average opportunity cost for a visit to the dentist.
• C) the remaining insured families tend to have a higher-than-average marginal cost for a visit to the dentist.
• D) the remaining insured families tend to feel that it is a status symbol to visit the dentist since the rest of the population are reducing their visits to the dentist.
• E) of adverse selection.

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Definitions:

Voidable

A contract or agreement that is valid until one party decides to cancel or invalidate it due to certain legal deficiencies.

Negligent Misrepresentation

A false statement made carelessly that induces another party to enter into a contract, resulting in harm or damage.

Reasonable Care

A legal standard requiring individuals or organizations to act with the level of caution and vigilance that a prudent person would under similar circumstances, to prevent harm to others.

Scienter

Intent or knowledge.