Which of Following Provisions in an Insurance Policy May Be

question 10

Multiple Choice

Which of following provisions in an insurance policy may be economically efficient if policy holders can control small claims but not large ones?

• A)Vigilance provision
• B)Non-price exceptions
• C)Co-payment provisions
• D)Liquidated damages

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Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Demand

The desire and willingness of consumers to purchase goods or services at a given price level.

Supply

The total amount of a product or service that is available to consumers at a given price point and time.

Technology

The application of scientific knowledge for practical purposes, especially in industry and improvements in tools, machines, techniques, and systems.