For each of the following kinds of insurance, give anexample of behavior that can be called moral /raumtand anotJ,cr example of behavior that can be calledadverse selection.a. health insuranceb. car insurancec. tile insurance

For each of the following kinds of insurance, give anexample of behavior that can be called moral /raumtand anotJ,cr example of behavior that can be calledadverse selection.a. health insuranceb. car insurancec. tile insurance

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter9: The Basic Tools Of Finance

Section: Chapter Questions

Problem 5PA

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Question

For each of the following kinds of insurance, give an
example of behavior that can be called moral /raumt
and anotJ,cr example of behavior that can be called
adverse selection.
a. health insurance
b. car insurance
c. tile insurance

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Dr. Wexler displays her medical degree in her officewaiting room, hoping patients will be impressed thatshe attended a prestigious medical school. This isan example ofa. moral hazard.b. adverse selection.c. signaling.d. screening.
Which is the best example of health care insurance in the sense of socializing risk? a. A dental insurance policy that pays for two check-ups a year but nothing else.b. A comprehensive health care policy that essentially pays for everything including check ups but is very expensivec. A health care policy that is relatively inexpensive but only pays for medical expenses after a $2,000 annual deductible is met. After $2,000 the policy pays 100 percent for everything.
True/False: If a health insurance company could somehow monitor everything a customerdoes and thinks, it could create a full-insurance contract with no moral hazard. X. When is the social loss the lowesta. A 20% coinsurance and high deductibleb. A 20% coinsurance and low deductiblec. A 20% coinsurance, low co-pays and high deductibled. A 20% coinsurance, high co-pays and high deductible XI. Calculate the out of pocket spending in the following insurance plan - A co-pay for $20,coinsurance of 0% and deductible of 500. Assume that the doctor’s visit cost $1000a. 520b. 500c. 820d. 800 XII. Which of the following is not an example of adverse selectiona. Increasing use of health care for health services like preventive care servicesb. Developing asthma that is the outcome of a mining jobc. Not reporting a hereditary heart disease when signing up for insuranced. Increasing the number of cigarettes smoked once you get employer based healthinsurance Please answer all 3 questions. Thanks