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Explain the adverse selection and moral hazard problems

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Question - Explain the adverse selection and moral hazard problems in insurance. Gorton Insurance Company wants to properly price its auto insurance, which protects against losses due to auto accidents. If Gorton wants to avoid the adverse selection and moral hazard problems, should it assess the behavior of insured people, uninsured people, or both groups? Explain.

Reference no: EM132919356

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