With respect to the health insurance market, what is moral hazard?
A) Moral hazard refers to the actions people take, after they purchase an insurance policy, that make the insurance company worse off.
B) Moral Hazard refers to to people who purchase one type of insurance policy when they would have been better off purchasing a different policy.
C) Moral Hazard refers to the situation in which a person purchasing an insurance policy takes advantage of knowing more about his health than the insurance company.
D) Moral hazard refers to the actions people take before they purchase an insurance policy.
A
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The United States was among the first of the modern industrial nations to establish a central banking system
a. True b. False Indicate whether the statement is true or false
According to the Laffer curve,
a. an increase in tax rates will always cause tax revenues to increase. b. when marginal tax rates are high, an increase in tax rates is likely to cause tax revenues to increase. c. when marginal taxes are low, an increase in tax rates will probably cause tax revenues to decline. d. when marginal tax rates are high, a reduction in tax rates may increase tax revenue.
In 1936, when the Fed doubled the reserve requirements, bank executives:
A. allowed their excess reserves to decline. B. maintained the level of excess reserves desired by the Fed. C. increased excess reserves to the level prior to the change in requirements. D. increased lending from remaining reserves, causing inflation.
In a market economy, every real transaction has a corresponding:
A. financial liability. B. real asset. C. financial transaction. D. real liability.