The Fact That Someone with a High Risk of Medical

question 437

Multiple Choice

The fact that someone with a high risk of medical problems is likely to buy a large amount of health insurance is an example of

• A) adverse selection.
• B) monitoring.
• C) moral hazard.
• D) screening.

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Definitions:

Budget Deficits

A financial situation where a government's expenditures surpass its revenues.

Budget Surpluses

A situation where a government's revenue exceeds its expenditures over a specific period, indicating financial health.

Annually Balanced Budget

A budget in which revenues and expenditures are equal within a single fiscal year, ensuring no deficit or surplus.

Contractionary Gap

A situation where the aggregate output in an economy is below its potential output, leading to unemployment and underutilized resources.