Exploring Microeconomics
8th Edition
ISBN: 9781544339443
Author: Sexton, Robert L.
Publisher: Sage Publications, Inc., Corwin, Cq Press,
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Question
Chapter 17, Problem 24P
To determine
To explain:
The way higher deductibles help to reduce moral hazard problems.
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Check out a sample textbook solutionStudents have asked these similar questions
How can deductibles, copayments, and coinsurance reduce moral hazard?
How is the moral hazard problem relevant to the health care market?
The lower the deductible on an insurance policy, the higher the premiums.
True or False
Chapter 17 Solutions
Exploring Microeconomics
Ch. 17 - Prob. 1PCh. 17 - Prob. 2PCh. 17 - Prob. 3PCh. 17 - Prob. 4PCh. 17 - Prob. 5PCh. 17 - Prob. 6PCh. 17 - Prob. 7PCh. 17 - Prob. 8PCh. 17 - Prob. 9PCh. 17 - Prob. 10P
Ch. 17 - Prob. 11PCh. 17 - Prob. 12PCh. 17 - Prob. 13PCh. 17 - Prob. 14PCh. 17 - Prob. 15PCh. 17 - Prob. 16PCh. 17 - Prob. 17PCh. 17 - Prob. 18PCh. 17 - Prob. 19PCh. 17 - Prob. 20PCh. 17 - Prob. 21PCh. 17 - Prob. 22PCh. 17 - Prob. 23PCh. 17 - Prob. 24PCh. 17 - Prob. 25PCh. 17 - Prob. 26PCh. 17 - Prob. 27PCh. 17 - Prob. 28P
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- As an employer, why might Vivian be reluctant to offer her employees a health insurance plan with a very low annual deductible?arrow_forwardHow much is Jane’s deductible? What percentage of the bill does Jane’s health care plan pay once co-insurance begins? What percentage of the bill does Jane pay once co-insurance begins? How much is Jane’s out-of-pocket limit? How much does Jane pay after she reaches her out-of-pocket limit?arrow_forwardCyclists travel faster on their bicycles when wearing helmets. Is this an example of adverse selection or moral hazard? Explain your answer.arrow_forward
- You have a prescription drug insurance plan with a $500 deductible, 25% coinsurance after the deductible, and an out of pocket maximum of $1,250. What would you owe in cost sharing if you had $2,075 of prescription drug claims during the year?arrow_forwardTo receive coverage for bodily injury resulting from an accident with a stolen vehicle, an individual should purchase which of the following coverage? please read the question carefully? Medical payment Uninsured Motorists Bodily injury liability Property damage liabilityarrow_forwardCyclists travel faster on their bicycles when wearing helmets. Is this an example of adverse selection or moral hazard?arrow_forward
- Empirical evidence suggests that state laws mandating health insurance coverage for alcoholism treatment leads to moral hazard on the part of the insured population. Given this information, what are you most likely to observe in a state that has passed such a law? A. Less use of alcohol treatment facilities B. Lower rates of drunk driving C. Higher rates of alcoholism D. Lower sales of alcoholarrow_forwardApproximately __________ million Americans are without health insurance.arrow_forwardThe government can help solve the problem of adverse selection in each of these ways EXCEPT: a. reducing the need for insurance. b. requiring that everyone buy insurance. c. providing incentives for buyers to reveal private information. d. providing insurance.arrow_forward
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