If fair insurance is offered to a risk-averse person, she will
A) buy enough insurance to eliminate all risk.
B) not buy any insurance because it is overpriced.
C) not buy any insurance since the marginal utility of the amount of the payment is positive.
D) buy enough insurance to cover about half of the possible loss.
A
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Suppose pollution, which generates a negative externality, exists in a market. If transactions costs are low and parties are willing to bargain, then, according to the Coase theorem,
A) an equitable solution can only be reached if property rights are assigned to the victims of pollution and not the polluters. B) an equitable solution can only be reached if property rights are assigned to the polluters, and not the victims of pollution. C) an efficient solution can be reached regardless of the initial assignment of property rights. D) government intervention is necessary to reach an efficient and equitable solution.
Using the scenario above explain how this could have happened?
What will be an ideal response?
If the population increases and input prices decrease, the equilibrium quantity of a product will definitely increase
Indicate whether the statement is true or false
Which type of managed care organization has the strictest cost control features?
a. Group-model HMO. b. IPA. c. POS plan. d. Closed-panel HMO. e. PPO.