Which of the following is an example of moral hazard in the medical industry? Choose the best answer: a. A surgeon wants the opportunity to perform for minor ailments b. Insurance companies and individuals do not openly share information c. Prices are not transparent or consistent among customers d. Those with significant health insurance coverage tend to overuse health services

Which of the following is an example of moral hazard in the medical industry? Choose the best answer: a. A surgeon wants the opportunity to perform for minor ailments b. Insurance companies and individuals do not openly share information c. Prices are not transparent or consistent among customers d. Those with significant health insurance coverage tend to overuse health services

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter20: The Problem Of Adverse Selection Moral Hazard

Section: Chapter Questions

Problem 6MC

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Because Elaine has a family history of significantmedical problems, she buys health insurance,whereas her friend Jerry, who has a healthier family,goes without. This is an example ofa. moral hazard.b. adverse selection.c. signaling.d. screening
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define and explain the importance of moral hazard