walden MGMT6695 week 2 quiz 46634

Question

Question 1

1.

Offering insurance coverage through an optional rider would likely cause the most problems with adverse selection for which condition?

Answer

1 points

Question 2

1.

Bill's health insurance covers preventive and cosmetic dental services, including orthodontic care, for employees and their family members. Bill is willing to pay $30 per month for over-the-counter teeth-whitening strips at the local pharmacy. With his co-pay, he learns he can pay $25 per month and receive professional teeth-whitening services at his dentist. He chooses to go to the dentist for the service, which costs the insurance company $75 per month.

This is an example of adverse selection. True or false?

Answer

[removed] True

[removed] False

1 points

Question 3

1.

An actuarial assistant at an HMO presents graphs and charts of the number of colonoscopies performed per 1,000 patients by each doctor in its plan. This is an example of:

Answer

1 points

Question 4

1.

Catastrophic medical expenses are large, infrequent, and unpredictable. Risk aversion explains why people buy insurance which covers such catastrophic events.

Answer

[removed] True

[removed] False

1 points

Question 5

1.

Health economists observe individuals' willingness to pay not only by observing cash transactions, but also by observing patients' time spent waiting and/or pain endured to obtain medical services. Examples of observable, non-cash prices paid by patients include all of the following,except:

Answer

1 points

Question 6

1.

The Law of Large Numbers explains why it is unlikely that the actuarially fair premium for an insurance policy will be the same for a small start-up firm as it will be for a large employer such as a university.

Answer

[removed] True

[removed] False

1 points

Question 7

1.

The demand for cosmetic surgery is more elastic than the demand for Botox treatments. True or false?

Answer

[removed] True

[removed] False

1 points

Question 8

1.

If a dentist decides to lower the price of teeth-whitening treatments, total sales (revenues) for treatments will go up if:

Answer

1 points

Question 9

1.

Health Savings Accounts may contribute to risk-sharing problems as younger, healthier, better-educated individuals use HSAs as savings accounts. True or false?

Answer

[removed] True

[removed] False

1 points

Question 10

1.

Traditional fee-for-service (FFS) payment plans of Medicare and Medicaid in the 1970s contributed to cost escalation because:

Answer