Author Question: If the company can correctly anticipate the adverse selection, what premiums would it charge? a. ... (Read 46 times)

WhattoUnderstand · **on:** Jul 1, 2018

If the company can correctly anticipate the adverse selection, what premiums would it charge?
a. 2500
b. 2600
c. 1000
d. 1100

Question 2

If you are willing to purchase a house for 300,00 . and you purchase the house for 275,000 . this transaction will generate:
a. There is no surplus created
b. 25,00 . worth of seller surplus and unknown amount of buyer surplus
c. 10,00 . worth of buyer surplus and 15,00 . of seller surplus
d. 25,00 . worth of buyer surplus and unknown amount of seller surplus