The Moral Hazard Problem Created When Consumers Acquire Health Insurance

question 115

Multiple Choice

The moral hazard problem created when consumers acquire health insurance leads them to

• A)take more care of their health.
• B)consume more health care services.
• C)seek less care from their physicians.
• D)exercise more and eat healthier food.

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Definitions:

Sales On Account

Transactions where goods are sold and payment is deferred, creating an account receivable for the seller.

Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced over a period, indicating the efficiency of inventory management.

Financial Statements

The comprehensive reports that summarize a company's financial performance, position, and cash flows over a specific period.

Current Ratio

An assessment tool that determines an enterprise's capability to settle short-term due debts by dividing its immediate assets by its immediate liabilities.