Why Is There an Asymmetric Information Problem in the Market

question 195

Multiple Choice

Why is there an asymmetric information problem in the market for health care?

• A)The patient, not the physician, knows most about the amount and type of health care to be provided.
• B)The government, not the physician, knows most about the amount and type of health care to be provided.
• C)Insurance companies, not the physician, know most about the type of health care to be provided.
• D)The physician, not the patient, knows most about the amount and type of health care to be provided.

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Definitions:

Glacier

A large mass of ice, formed from compacted layers of snow, that moves slowly over land.

Erosion

The process by which the surface of the Earth is worn away by the action of water, wind, or ice.

Terminal Moraine

Glacially carried sediment that accumulates at the terminus (end) of a glacier and a landform composed of such material; generally marks the glacier’s farthest downhill extent.

Recessional Moraine

A moraine that forms as the front of a glacier melts back and stagnates for some time in one location, depositing a pile of sediment.