With Moral Hazard,fair Insurance Contracts Are Not Viable Because

question 1

Multiple Choice

With moral hazard,fair insurance contracts are not viable because

• A)individuals' aversion to risk is reduced.
• B)insurance company's administrative costs are increased.
• C)individuals fear unscrupulous agents.
• D)probabilities of loss are increased over what is expected.

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Definitions:

Telecommute

The practice of working from a remote location, typically one's home, using the internet and telecommunications technology.

Overhead Costs

Expenses associated with running a business that are not directly tied to creating a product or service, such as rent, utilities, and insurance.

Security Concerns

Issues or threats that could potentially harm the integrity, confidentiality, or availability of information or physical well-being of individuals.