Which of the Following Is an Example of Adverse Selection

question 159

Multiple Choice

Which of the following is an example of adverse selection?

• A)The odds of a fire rise after a building is insured because the person with fire insurance is likely to pay less attention to fire hazards.
• B)Someone who did not install fire alarms and a sprinkler system in a building he owns buys insurance for the building.
• C)Someone with automobile insurance drives more recklessly than someone without insurance.
• D)People prefer to buy new cars rather than used cars.

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Definitions:

Microsporidia

A group of spore-producing unicellular parasites that can infect a variety of hosts, including humans, often leading to disease in immunocompromised individuals.

Unicellular Parasites

Single-celled organisms that live and feed on other living entities, often causing diseases.

Flagellum

A whip-like structure present in some cells that is used for locomotion or sensory functions.

Amanita

A genus of mushrooms, which includes both highly toxic species, such as the death cap, and edible species.