The Cost of Group Health Insurance Is Lower Than If

Multiple Choice

The cost of group health insurance is lower than if an individual buys a policy on his own because

A) the problem of adverse selection is reduced.
B) moral hazard costs of a group tend to move to a low average.
C) it is easier for the company to deny claims from a large group.
D) insuring a group eliminates the problem of buyers having more information than the seller.