This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Define the term property rights. Explain why the lack of well-defined and enforceable property ... (Read 85 times)

BrownTown3

  • Hero Member
  • *****
  • Posts: 564
on: Jun 29, 2018
Define the term property rights. Explain why the lack of well-defined and enforceable property rights is detrimental to the smooth functioning of a market system.
 
  What will be an ideal response?

Question 2

What kinds of risks can't be insured?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Liamb2179

  • Sr. Member
  • ****
  • Posts: 365
Reply #1 on: Jun 29, 2018
Answer to Question 1

The term property rights refers to the rights that individuals or firms have to the exclusive use of their resources, within the confines of the law. Well-defined and enforceable property rights provide the incentive for people and firms to invest resources and undertake risks. This encourages the production of a wide range of goods and services. Without property rights and the means to enforce these rights, no person would want to undertake such a risk.

Answer to Question 2

Insurance works because the risks of adverse outcomes are independent, that is, one person suffering a loss does not affect the likelihood that other people will suffer similar losses. If the losses from an event are not independent, so that everyone suffers a loss at the same time, then the risk of loss cannot be insured.


BrownTown3

  • Member
  • Posts: 564
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

31809pancho

  • Member
  • Posts: 317
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

All adverse reactions are commonly charted in red ink in the patient's record and usually are noted on the front of the chart. Failure to follow correct documentation procedures may result in malpractice lawsuits.

Did you know?

The first war in which wide-scale use of anesthetics occurred was the Civil War, and 80% of all wounds were in the extremities.

Did you know?

Adults are resistant to the bacterium that causes Botulism. These bacteria thrive in honey – therefore, honey should never be given to infants since their immune systems are not yet resistant.

Did you know?

Drying your hands with a paper towel will reduce the bacterial count on your hands by 45–60%.

Did you know?

HIV testing reach is still limited. An estimated 40% of people with HIV (more than 14 million) remain undiagnosed and do not know their infection status.

Associative Long-Term Potentiation Associative Long-Term Potentiation
Failure of the Equal Rights Amendment, 1972–1982 Failure of the Equal Rights Amendment, 1972–1982
Alternative methods for locating the CPT Main Term. Alternative methods for locating the CPT Main Term.
Long-term Potentiation in the granule cell layer of the rat hippocampal dentate gyrus. (Traces ... Long-term Potentiation in the granule cell layer of the rat hippocampal dentate gyrus. (Traces ...
Please fully explain the answer with steps Please fully explain the answer with steps
Flexible exchange rates are supposed to prevent long-term trade deficits. Flexible exchange rates are supposed to prevent long-term trade deficits.
Video: Neurosynapse Animation

For a complete list of videos, visit our video library