Because People with Hidden Health Problems Are More Likely to Buy

question 103

Multiple Choice

Because people with hidden health problems are more likely to buy health insurance than are other people,

• A) the price of health insurance reflects the costs of a sicker-than-average person.
• B) the price of health insurance is too low, relative to the socially-optimal price.
• C) people in average health may be encouraged to buy too much health insurance, relative to the socially-optimal quantity.
• D) the Condorcet Paradox suggests that people who are sicker than average will ultimately buy more health insurance.

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