Adverse Selection Is Said to Exist When an Individual

question 32

Multiple Choice

Adverse selection is said to exist when an individual

• A)is not able to take advantage of another individual.
• B)has the incentive to,and is able to,shift costs to another individual.
• C)selects a product which has adverse externalities.
• D)purchases a lot of insurance because he/she knows that he/she is at high risk.
• E)is averse to certain products.