A Bill Pending Before the Legislature in the Tiny Island

question 239

Multiple Choice

A bill pending before the Legislature in the tiny island nation of WooHoo would prohibit private companies from selling canoe insurance and make the state the single payer of claims for canoe accidents. Private insurance companies that have made above normal profits have spent large sums of money trying to prevent the legislature from passing this bill into law. This is an example of

• A) government failure.
• B) collusion.
• C) an externality.
• D) rent-seeking behavior.

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Definitions:

Introductory

Pertaining to the beginning or initial phase of something, often used to describe the first exposure to a topic or the initial version of a product.

Demonstration

The act of showing how a product or service works, often used as a sales technique to provide visual and practical proof of benefits.

Product

Any item or service that is offered to the market to fulfill a want or need.

Curiosity

A strong desire to know or learn something, often driving exploration and discovery.