If insurers charge everyone the same premium based on the average cost of insuring the entire group, _____
a. the poor will drop out because the premiums are too high
b. the middle class individuals will drop out because they can self-insure
c. the healthiest individuals in the market will drop out
d. the sickest individuals in the market will drop out
c
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The present value of a sum of money to be received in future is high if ________
A) the money is invested for a long period of time B) the market rate of interest is low C) the rate of inflation is high D) the future payment is low
Which of the following statements is false?
A) Keynes believed that the level of investment depends on more than just the interest rate. B) Saving is the difference between disposable income and consumption. C) Keynes believed that saving is more responsive to changes in income than to changes in the interest rate. D) According to Keynes, wage rates may fall too quickly when the economy is in a recessionary gap.