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Compare and contrast two quantitative tools for decision-making in conditions of certainty
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- Describe and use techniques that apply to decision making under uncertainty.The difference between the value of one action and the value of the best alternative is called moral hazard. Group of answer choices True FalseSince health care expenditures in many poor African countries such as Ghana average about $12 per person per year, there is no misallocation of resources. True False
- John wants to buy a used car. He knows that there are two types of car in the market, plums and lemons. Lemons are worse quality cars and are more likely to break down than plums. John is willing to pay £10, 000 for a plum and £2, 000 for a lemon. Unfortunately, however, he cannot distinguish between the two types. Sellers can offer a warranty that would cover the full cost of any repair needed by the car for y ∗ years. Considering the type and likelihood of problems their cars can have, owners of plums estimate that y years of guarantee would cost them 1000y, owners of lemons estimate that the cost would be 2000y. John knows these estimates and decides to offer £10, 000 if a car comes with y ∗ years of warranty, £2, 000 if a car comes without warranty. For which values of y ∗ is there a separating equilibrium where only owners of plums are willing to offer the y ∗ -years warranty? Clearly explain your reasoning.QUESTION 13 The size of the uninsured and underinsured population in the United States has become an indication of the access problems in the US healthcare system.TrueFalse QUESTION 14 If the expected age of death for a male aged 20 is 75, then a 20-year-old man who dies is considered to have lost how many years of life? A. 20 years of life B. 75 years of life C. 55 years of life D. None of these QUESTION 15 Why is survival time considered to be a good indicator of health status? A. It measures health outcomes as compared to costs B. It places an emphasis on the time spent(duration) in a specific health state C. The measure accounts for mortality rates D. It measures outcomes or health state at a given point in timePublic health strategies aim to prevent or reduce the prevalence of type 2. Provide exmaples backed with data of these stragies having a effect int he past 10-20 years. provide a few public helath stragies that have been effective in the uk and and few that have not been effective. Same for the USA and Austriala examples and weatehr if they have been effective or not
- In the markets for used items, there is a natural inclination for adverse selection. This means- Only high quality items are sold.- All items are sold- Only low quality items are sold - A mix of high and low quality items are sold.The application which provides a way of revising conditional probabilities by using available information and provisions for revising conditional probabilities with other information that is useful for management decision making is called? Select one: a. Bayes’ theorem. b. overinvolvement ratios. c. probability rules. d. empirical formula.A way to help overcome adverse selection is to ... require a deductible be paid before benefits are received. require all citizens to purchase insurance. subsidize insurance premiums. tax insurance benefit payouts.
- Multiple answers may be correct.Multiple Choice Adverse selection describes a situation where an individual's demand for insurance is positively correlated with the individual's risk of loss. Adverse selection occurs when someone increases their exposure to risk when insured. This can happen, for example, when a person takes more risks because someone else bears the cost of those risks. The relationship between smoking status and mortality provides a good illustration for adverse selection, especially in the case in which a life insurance company did not vary its premiums according to smoking status of its customers. To counter the effects of adverse selection, insurers may offer premiums that are proportional to a customer's risk.Indicate whether the statement is true or false, and justify your answer.A risk-averse individual prefers a certain outcome to an uncertain outcome with the same expected income.