What Are Adverse Selection and Moral Hazard

question 59

Essay

What are adverse selection and moral hazard?

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Definitions:

Variability

A measure of how much scores in a data set differ from each other and from the mean, indicating the spread or dispersion of the data points.

Sample Means

The arithmetic average of a set of values or measurements taken from a sample of a larger population.

Z-test

An analytical procedure in statistics that checks for differences between the means of two groups when the variances are established and there is a considerable number of samples.

Standard Error

A measure of the dispersion or variation of the sampling distribution of a statistic.