(Solved):When an insurance plan enables policy-holders to not fully realize the full cost of medical care, then which of the following is most true? a. Policy-holders will likely consume more than without… View Answer…

 

Question

When an insurance plan enables policy-holders to not fully realize the full cost of medical care, then which of the following is most true?

a. Policy-holders will likely consume more than without the plan.

b. Moral hazard will likely be an issue.

c. A market failure is likely to result.

d. All of the above.

 

EXPERT ANSWER

The answer is d.

When individuals are covered by medical insurance, and do not fully realized the cost of medical

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