The increase in extremely expensive lifesaving treatments is a primary cause of the rise in health insurance because _____
a. people want to protect against low probability, expensive events
b. people view insurance as a down payment on a predicable event
c. people want to protect against low probability, inexpensive events
d. individuals want to protect themselves from being gouged by doctors who know they need a lifesaving operation
a
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Economies of scale enable financial institutions to
A) reduce transactions costs. B) avoid the asymmetric information problem. C) avoid adverse selection problems. D) reduce moral hazard.
Economic mobility in the United States is
a. great, so many of those below the poverty line are there only temporarily. b. rare, so most of those below the poverty line are there for decades. c. rare, yet many of those below the poverty line are there only temporarily. d. unrelated to poverty.