Cellular Phone Service Is an Example of a Good That

question 89

Multiple Choice

Cellular phone service is an example of a good that is generally:

• A) nonexcludable and nonrival.
• B) nonexcludable and rival.
• C) excludable and nonrival.
• D) excludable and rival.

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Definitions:

Moral Hazard

The situation in which one party takes greater risks because another party bears the cost of those risks, often seen in insurance and financial sectors.

Contract Parties

The entities involved in a contractual agreement, typically including at least one offeror and one offeree.

Adverse Selection

A situation where asymmetric information results in high-risk individuals being more likely to engage in agreements, potentially leading to market failure.

Cafeteria Plan

A type of employee benefit plan that allows workers to choose from a variety of pre-tax benefit options to suit their personal needs.