The Following Statements Indicate the Pricing Policies of Two Health

question 89

Multiple Choice

The following statements indicate the pricing policies of two health plans that operate in a particular market: The Accent Health Plan consistently underprices its product The Bolton Health Plan uses extremely strict underwriting practices for the small groups to which it markets its plan From the following answer choices, select the response that correctly indicates the most likely market effects of the pricing policies used by Accent and Bolton.

• A) Accent = unprofitable business Bolton = high acquisition rate
• B) Bolton = low acquisition rate
• C) Accent = high profits

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Definitions:

Dangerous Per Se Rule

A legal doctrine that an act, by its nature, is inherently dangerous and can lead to liability without the need to prove negligence.

Handguns

Firearms designed to be handheld, used for self-defense, sporting activities, and law enforcement.

Telemarketing Sales Rules

Regulations designed to protect consumers from deceptive or abusive telemarketing practices.

Total Cost

The complete cost of production, including fixed and variable costs.