Adverse selection in insurance requires that
a. potential customers face different levels of risk
b. potential customers facing more risk are no more interested in purchasing insurance
c. people are not risk averse
d. insurers can tell higher risk people from lower risk people
a
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If a political scientist believes Brazil is on the brink of civil unrest, which will significantly reduce next year's coffee supply, he should ________ coffee futures
Other things constant, he is more likely to profit from his decision when ________ people are aware of the possibility of the civil unrest. A) sell; fewer B) buy; fewer C) sell; more D) buy; more
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A) -5,657 B) 5,657 C) 124,343 D) 128,850