Which of the Following Best Describes How Moral Hazard Affects

question 24

Multiple Choice

Which of the following best describes how moral hazard affects the price of insurance?

• A)Since insurers can acquire complete information regarding the riskiness of borrowers,they can charge actuarially fair premiums.
• B)Since firms may have private information about how risky they are,insurers must raise premiums to compensate for the existence of this uncertainty.
• C)Since purchasing insurance reduces the firm's incentive to avoid risk,insurers must raise premiums to compensate for the increase in risk.
• D)Since purchasing insurance reduces the firm's risk,insurers can lower premiums to compensate for the reduction in risk.
• E)Since high premiums will drive away the low-risk firms,insurers must lower premiums in order to attract low-risk borrowers.

Identify structures and molecules involved in muscle contraction and energy conversion.

Explain the organization and hierarchy of muscle structure from macro to micro.

Describe the process and components involved in neuromuscular junctions and neurotransmitter function in muscle contraction.

Understand the physiological responses during muscular activity, including oxygen debt and regeneration of ATP.

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Definitions:

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage.

Investment

The allocation of resources, typically money, into assets with the expectation of generating income or profit in the future.

Machinery

Equipment with moving parts used to perform any type of work, often found in industrial or agricultural settings.

Equipment

Tangible property used in the operation of a business but not consumed or sold during the business cycle.