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:

Young Salesman

A term referring to a relatively inexperienced individual engaged in selling goods or services.

Economic Perspective

Viewing and analyzing economic phenomena in terms of costs, benefits, incentives, and the allocation of scarce resources.

Class Value

A concept reflecting the assumed worth or importance of a particular class in societal, economic, or educational settings.

Unemployment

The condition of being jobless despite actively looking for work, typically measured as a percentage of the labor force.