People's abilities to bear risk increases with: a. their ...

[Coya19@aol.com]

People's abilities to bear risk increases with:
 a. their abilities to understand the market.
  b. their abilities to diversify their asset holdings.
  c. their abilities to invest in risky assets over a large time period.
  d. their abilities to judge the probability of outcomes.

Question 2

Asymmetric information often makes it difficult to tell good from bad. This is a problem of
 A) moral hazard.
  B) negative externalities.
  C) adverse selection.
  D) moral hazard and not adverse selection.

[nothere]

Answer to Question 1

B

Answer to Question 2

C