If a doctor knows that an insurance company will pay for most of ...

[Chelseaamend]

If a doctor knows that an insurance company will pay for most of a patient's bill, the doctor has more of an incentive to require additional medical procedures and tests, even if the patient may not require them. This is an example of
 
  A) adverse selection. B) moral hazard.
  C) asymmetric information. D) the principle-agent problem.

Question 2

Refer to Figure 2-12. If the two countries have the same amount of resources and the same technological knowledge, which country has an absolute advantage in the production of milk?
 
  A) They have the same advantage. B) Tahiti
  C) Bora Bora D) cannot be determined

[tsternbergh47]

Answer to Question 1

D

Answer to Question 2

B

[Chelseaamend]

Gracias!

[raili21]

Excellent