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

Author Question: Robert applied for health insurance but did not mention in the application form that his family has ... (Read 69 times)

pepyto

  • Hero Member
  • *****
  • Posts: 547
on: Jun 29, 2018
Robert applied for health insurance but did not mention in the application form that his family has a history of heart ailments that are considered to be hereditary. What will happen if several customers like Robert purchase the insurance?
 
  What will be an ideal response?

Question 2

A price ceiling leads to a(n) ________ if below equilibrium price.
 
  A) increase in social well-being
  B) increase in producer surplus
  C) decrease in market demand
  D) decrease in total surplus


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

janeli

  • Sr. Member
  • ****
  • Posts: 346
Reply #1 on: Jun 29, 2018
Answer to Question 1

A person like Robert with a family history of heart ailments is more likely to fall ill. Insurance companies require higher premiums to cover the health expenses of such high-risk individuals, but if premiums are high, a person with a lower chance of falling ill will not buy the insurance. If several customers like Robert buy the insurance, the premium will continue to rise, forcing all low-risk individuals to stay out of the market. This is an example of adverse selection in the insurance market.

Answer to Question 2

D


pepyto

  • Member
  • Posts: 547
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

kishoreddi

  • Member
  • Posts: 329
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

It is difficult to obtain enough calcium without consuming milk or other dairy foods.

Did you know?

Cutaneous mucormycosis is a rare fungal infection that has been fatal in at least 29% of cases, and in as many as 83% of cases, depending on the patient's health prior to infection. It has occurred often after natural disasters such as tornados, and early treatment is essential.

Did you know?

Asthma-like symptoms were first recorded about 3,500 years ago in Egypt. The first manuscript specifically written about asthma was in the year 1190, describing a condition characterized by sudden breathlessness. The treatments listed in this manuscript include chicken soup, herbs, and sexual abstinence.

Did you know?

Less than one of every three adults with high LDL cholesterol has the condition under control. Only 48.1% with the condition are being treated for it.

Did you know?

Individuals are never “cured” of addictions. Instead, they learn how to manage their disease to lead healthy, balanced lives.

Asthma. (a) A normal bronchiole. (b) An asthmatic bronchiole. During an asthma “attack,” the bronchi Asthma. (a) A normal bronchiole. (b) An asthmatic bronchiole. During an asthma “attack,” the bronchi
Determinants of health Determinants of health
Gestalt principles of form and perception Gestalt principles of form and perception
Comparison of Paper Medical Records and Electronic Health Records Comparison of Paper Medical Records and Electronic Health Records
Instructions for Completing the CMS-1500 (02/12) Claim Form Continued Instructions for Completing the CMS-1500 (02/12) Claim Form Continued
Preventing Claim Form Rejection Preventing Claim Form Rejection
Video: Haustral churning, Gastrocolic reflex and mass peristalsis & Defecation

For a complete list of videos, visit our video library