Question

can you plzz explain in detail

21. The Affordable Care Act (Obamacare) mandates that everyone buy health insurance or face a penalty. The rationale for this policy is to: solve the adverse selection problem. A B) solve the moral hazard problem. C) make sure that high-risk people pay higher premiums than low-risk people D ensure that Medicare enrollees pay actuarially fair insurance premiums. ) 22. Many states have laws requiring that health insurance policies cover the treatment of diabetes. One study found that after the passage of these laws, diabetics became fatter, which complicates the treatment. This study's finding is an example of cost lag. ) B) hysteresis. C) the multiplier moral hazard. A D Which of the following statements is (are) TRUE of selling agents in residential real 23. estate transactions? Because agents are paid on commission, there is no principal-agent problem. ) B) A Agents have an incentive to sell quickly, without waiting for slightly higher offers. If an agent sells an owner's home for an additional $20,000, the agent stands to C) gain more than the owner. Owners know more than agents about the state of the real estate market and the value of comparable homes. 24. Suppose half of workers have high productivity and half of workers have low productivity. High-productivity workers are valued at $100,000 a year and low- productivity workers are valued at $40,000 a year. Because of asymmetric information, employers cannot tell them apart, so all workers are paid according to the average economy-wide value of productivity. If high-productivity workers found a method to signal their productivity to employers, high-productivity pay would by $30,000, and low-productivity pay would increase; increase by $30,000 A increase; decrease by $30,000 B) decrease:; increase by $30,000 C) neeman uvclonged

Answer 1

21. The Correct answer is B ( Solve the moral hazard Problem )

The Affordable Care Act mandates that everyone buy the health insurance or face a penalty. The rationale behind the policy is to solve moral hazard problem . Moral hazard is a situation exists where one has an incentive to use more resources than otherwise would have been used because another one bears the costs. The same like premium of low risk patients covers the cost of high risk patients.