When the average buyer of an insurance policy is likely to have higher risk than others in his class, this is known as

Related MCQs

• When people behave in ways that involve increased risk because they have insurance, this is known as
• If reckless drivers are more likely to buy automobile insurance than safe drivers are,
• Non diversifiable risk affects I. the opportunity cost of capital II. should enter into the risk premium
• If the government subsidizes the health insurance costs of individuals because individuals do not sufficiently realize the importance of having health insurance, which of the following justifications for government intervention is being used?
• A situation where people who have taken out insurance behave more recklessly as a result is known as:
• Suppose that you have complete health insurance that covers all expenses. You will use medical care up to the point where your:
• If, for John’s current intertemporal consumption pattern (satisfying his intertemporal budget constraint), his marginal rate of intertemporal substitution is 1 and the real rate of interest is positive, then...
• Monopoly power in a market is likely to:
• Diversifiable risk can be eliminated by
• Non diversifiable risk arises because