Multiple Choice
If the opportunity cost of sending a market signal if too great for risky people and low enough for safe people, there will exist a(n)
A) pooling equilibrium
B) separating equilibrium
C) adverse equilibrium
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q2: Co-insurance is an example of how a
Q3: Because of a moral hazard problem, a
Q4: Explain why insurance markets fail.
Q5: The amount any agent will have to
Q6: An example of market signaling in the
Q7: If a reputation for bad service would
Q8: An insurance lacks the information needed to
Q9: What are the pros and cons of
Q10: When the buyers and sellers in a
Q11: A separating equilibrium is an equilibrium where