With Regard to the Provision of Health Insurance in the United

question 71

Multiple Choice

With regard to the provision of health insurance in the United States, which of the following is regarded as a way of addressing moral hazard and adverse selection problems?

• A) reducing profit margins for insurance companies
• B) increasing profit margins for insurance companies
• C) reduced government involvement
• D) greater government involvement

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Definitions:

Government-operated Firm

is a business entity controlled or owned by the government to provide goods or services to the public.

Residual Claimants

Individuals or entities that have a claim on the remaining assets of a company after all liabilities have been satisfied, typically the shareholders.

State University

A publicly funded university that is primarily supported by a state government.

Barrier to Entry

Factors that prevent or hinder companies from entering into a specific market or industry.