Efficiency in risk bearing implies that
A) risk is completely eliminated.
B) the least risk-averse party bears most of the risk.
C) the most risk-averse party bears most of the risk.
D) all of the risk is borne by just one of the parties regardless of the degree of risk aversion.
B
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Seth's grandmother gave him a $50 savings bond for his birthday. The bond pays $50 at maturity, which is in five years. If the interest rate is 5%, the bond has a present value of $43.19
Indicate whether the statement is true or false
When the government sells something it produces,
a. revenue received must be greater than cost to justify government production b. revenue received must equal cost because government is a nonprofit organization c. the price does not always reflect the cost of producing the good d. the price charged is an accurate measure of the benefits generated e. it prices the good the same way a natural monopolist would