For each of the following scenarios, identify whether it is an example of adverse selection of sellers,

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For each of the following scenarios, identify whether it is an example of adverse selection of sellers, adverse selection of buyers, or moral hazard. Come up with a possible solution to each problem.

a. You hire your neighbor to check on your cat every day while you are traveling for the week. The neighbor checks on your cat every other day instead.

b. Your local seafood shop advertises fresh seafood, but you are not certain if the seafood is actually fresh or if it has been frozen.

c. People with asthma are more likely to buy health insurance.

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Principles Of Economics

ISBN: 9781319330156,9781319419769

2nd Edition

Authors: Betsey Stevenson, Justin Wolfers

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