The cost of group health insurance is lower than if an individual buys a policy on his own because
A) the problem of adverse selection is reduced.
B) moral hazard costs of a group tend to move to a low average.
C) it is easier for the company to deny claims from a large group.
D) insuring a group eliminates the problem of buyers having more information than the seller.
Answer: A
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Large denomination time deposits are the difference between ________ and ________.
Fill in the blank(s) with the appropriate word(s).
The willingness to pay for a commodity:
A) decreases as consumption of the commodity increases. B) increases as consumption of the commodity increases. C) is always less than the market price of the commodity. D) is always greater than the market price of the commodity.
Firms that sell information products experience relatively high fixed costs but, once they have produced the first unit, can
A) sell additional units at a loss, or above cost. B) provide expensive information products to consumers. C) sell additional units at a relatively low cost per unit. D) experience short-run diseconomies of scale.
The ECB has favored using ______ as a target for implementing monetary policy.
A) money supply B) inflation targets C) unemployment figures D) fiscal deficits