You offer an extended warranty for your product that is purchased by a few customers. If the product typically fails 2% of the time, the claim rate will exceed 2% of warranty purchasers because
a. adverse selection will lead those who are more reckless to purchase the warranty
b. moral hazard will lead those who purchase to be more reckless
c. you systematically underestimate product failure rates
d. Both A&B
d
Economics
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When traders perceive a permanent money supply adjustment, short-term nominal interest rates ___affected, the expected exchange rate ___ affected, and the spot exchange rate ___ affected.
a. are· is· is b. are; is; is not c. are not; is not; is not d. are; is not; is
Economics
Differentiate between the average tax rate and the marginal tax rate
What will be an ideal response?
Economics