People with Hidden Health Problems Are More Likely to Buy

question 19

Multiple Choice

People with hidden health problems are more likely to buy health insurance than are other people. This is an example of

• A)moral hazard and makes the cost of health insurance higher than otherwise.
• B)moral hazard and makes the cost of health insurance lower than otherwise.
• C)adverse selection and makes the cost of health insurance higher than otherwise.
• D)adverse selection and makes the cost of health insurance lower than otherwise.

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Definitions:

Sample Size

The quantity of data points or repetitions present in a sample used for statistical evaluation.

Random

Lacking any definite plan, purpose, or pattern, often used to describe events or selections that are made without bias.

Average Age

It represents the central value of age data points in a set, providing a typical age around which individual ages are distributed.

Fiber-optic

Refers to the technology that uses thin, flexible fibers of glass or other transparent solids to transmit light signals for telecommunications or lighting.