Individuals Who Have Access to Large-Group Coverage Are _______ Likely

question 3

Multiple Choice

Individuals who have access to large-group coverage are _______ likely to fall victim of cherry-picking behavior because the total cost of health insurance is distributed among a _______ number of subscribers.

• A) less; larger
• B) more; larger
• C) less; smaller
• D) equally; similar
• E) equally; larger

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Definitions:

Variable Cost

Costs that change in proportion to the level of production or business activity, such as materials and labor costs.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue is contributing to fixed costs and profits.

Incremental Manufacturing Cost

The additional cost incurred to produce one more unit of a product, excluding fixed costs.

Traditional Format Income Statement

A financial statement that presents a company's revenues, expenses, and profits in a standard format, often distinguishing between operating and non-operating activities.