Having Liability Coverage as Part of Auto and Homeowner's Policies

question 62

Multiple Choice

Having liability coverage as part of auto and homeowner's policies helps protect your ________ in the event of an accident.

• A) insurance rates
• B) credit rating
• C) net worth
• D) house value

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Definitions:

Short-Run Equilibrium

is a condition in which market supply and demand balance out at a certain price level, but only temporarily.

Monopolistically Competitive

describes a market structure where many firms sell products that are similar but not identical, allowing for competition.

Average Total Cost

The total cost divided by the quantity of output produced; it includes both fixed and variable costs.

Long-Run Equilibrium

A state in which all firms in a perfectly competitive market earn zero economic profits, indicating no incentive for entry or exit.