Which of the Following Is a Problem of Adverse Selection

question 90

Multiple Choice

Which of the following is a problem of adverse selection?

• A) The lender has a problem of distinguishing good risk from bad risk borrowers.
• B) The lender has a problem determining that the proceeds from a loan are being used as the borrower stated.
• C) A person takes up the hobby of bungee jumping after purchasing health insurance.
• D) Individuals use more medical services as a result of their purchase of a health insurance plan.

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Definitions:

Emotions

Complex psychological states that involve physiological arousal, expressive behaviors, and conscious experience.

Emotional Stability

is a personality trait referring to the extent to which a person is able to remain calm, composed, and untroubled by stress or pressure.

Emotional Expressiveness

Refers to the degree to which a person outwardly displays emotions or feelings through facial expressions, gestures, or speech.

Emotional Awareness

The ability to recognize and understand one's own emotions and the emotions of others.