Adverse selection occurs
A) when an insurance company loses money on its investments.
B) when insurance purchasers buy insurance but do not have a loss.
C) when catastrophic losses occur as a result of a natural disaster.
D) when applicants with a higher-than-average chance of loss seek insurance at standard rates.
Question 2
Ashley opened an all-you-can-eat buffet restaurant. The price per-person was based on what Ashley believed an average restaurant patron would consume. The restaurant began to lose money.
Ashley concluded that her patrons had above average appetites, and were attracted to her restaurant because they could eat as much as they wanted while being charged an average price. A similar phenomenon exists in insurance markets. This problem is called
A) legal hazard.
B) adverse selection.
C) attitudinal hazard.
D) nondiversifiable risk.
Selection of a nursing center
Directional selection pushes a phenotype one way or another.
Coefficients of relatedness: How kin selection works.
Christian Gladu, The Bungalow Company, The Birch, North Town Woods, Bainbridge
Directional Selection in Rock-Pocket Mice
Principles of Natural Selection