Which of the Following Is an Example of Adverse Selection

question 11

Multiple Choice

Which of the following is an example of adverse selection?

• A)A homeowner with a large fire insurance policy allows the wiring in her house to deteriorate.
• B)A woman with a large life insurance policy takes up sky diving.
• C)Your brother-in-law borrows $20,000 from you to open a pizza parlor, but spends it gambling at the racetrack instead.
• D)A man with a bad heart condition buys a large life insurance policy.

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Definitions:

Hyperglycemia

A condition characterized by an excessive amount of glucose in the bloodstream, often associated with diabetes mellitus.

Phospholipase C

An enzyme that plays a key role in cell signaling processes by hydrolyzing phospholipids to produce inositol triphosphate (IP3) and diacylglycerol (DAG), important secondary messengers.

Protein Kinase C

an enzyme that modifies other proteins by chemically adding phosphate groups to them, important in various cellular processes.

Signal Transduction

The process by which a chemical or physical signal is transmitted through a cell as a series of molecular events.