Figure 8-6A -Consider Figure 8-6A Above. Suppose You Are an Owner of Owner

question 157

Multiple Choice

Figure 8-6A
-Consider Figure 8-6A above. Suppose you are an owner of a local Wendy's restaurant near a large urban college or university. You hired a marketing research firm to conduct a survey among a sample of respondents in your area to find out their patronage of fast-food restaurants. Four weeks after the firm conducted the survey, it presented the following results to you. Which age group seems to patronize fast-food restaurants the most?

• A) 45 and older
• B) once a week or more
• C) 25 to 44
• D) once a month or less
• E) under 25

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Definitions:

Adverse Selection

A situation in which asymmetrical information leads to high-risk parties being more likely to participate in agreements, such as insurance, than low-risk parties.

Health Insurance Company

An organization that provides coverage for medical expenses in exchange for premium payments.

Minimize Adverse Selection

A strategy to reduce the likelihood of selecting undesirable alternatives or participants, often used in insurance and finance to prevent situations where the insurer or lender has less information than the applicant.

Screening

The process of evaluating or analyzing something for a specific purpose or quality.