When Individuals Conceal Their Increased Risk for a Disease from Insurance

question 1

Multiple Choice

When individuals conceal their increased risk for a disease from insurance companies, this is known as:

• A) Negative selection
• B) Adverse selection
• C) Positive skewing
• D) Risk enhancement
• E) Risk skewing

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Definitions:

Productivity

The efficiency with which input resources are converted into outputs, often measured as the amount of output produced per unit of input.

Discount Rate

The discount rate refers to the interest rate used in discounted cash flow analysis to determine the present value of future cash flows or to assess the attractiveness of an investment.

Net Present Value

The calculation used to find the present worth of a series of future cash flows by discounting them at a given interest rate, important for investment analysis.

Conservation

The practice of preserving natural resources and protecting the environment for future generations.