A Home Has Been on the Market for an Extended

question 137

Multiple Choice

A home has been on the market for an extended amount of time without much interest from buyers. The sellers decide to purchase and include a home warranty insuring against major defects with the home. The warranty is an example of a(n)

• A)signal.
• B)screen.
• C)moral hazard.
• D)adverse selection.

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Definitions:

Sebaceous Glands

Glands located in the skin that secrete an oily substance called sebum, involved in lubricating skin and hair.

Elastic Fibers

Components of connective tissue that provide elasticity and flexibility, composed primarily of the protein elastin.

Ultraviolet Light

A form of electromagnetic radiation with a wavelength shorter than that of visible light but longer than X-rays, capable of causing chemical reactions and physical burns.

Vitamin D

A group of fat-soluble secosteroids responsible for increasing intestinal absorption of calcium, magnesium, and phosphate.