What is one reason car insurance seems much cheaper than health insurance?
A) Health insurance entails more idiosyncratic than systematic risk, and therefore the gains to diversification are more dramatic.
B) Car insurance entails more systematic than idiosyncratic risk, and therefore the gains to diversification are more dramatic.
C) Health insurance entails more systematic than idiosyncratic risk, and therefore there are fewer gains to diversification.
D) Health insurance is manipulated through market power, and car insurance is not.
C
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The total amount of debt owed by the federal government is represented by the total value of the outstanding
A. U.S. government securities. B. bank loans and deposits. C. Federal Reserve notes. D. stocks and bonds.
The annual price of a one dollar loan is referred to as the:
A) service tax. B) rate of interest. C) discount value. D) principal.
If an inefficient public monopoly cannot provide a service at a price that sufficient numbers of people are willing to pay it:
A. can remain in operation by covering its losses with revenue from taxes. B. must shut down and leave the industry in the long run. C. should expand operations until demand is satisfied. D. will seek out more efficiencies.
An appreciation of one's currency means that:
a. the country's exports will become less expensive. b. the country's imports will become more expensive. c. the country's imports will become less expensive. d. it now requires more of this currency in exchange for one unit of another currency. e. it now requires less units of other currencies in exchange for one unit of this currency.