Health insurance by employers as a fringe-benefit reduces

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Reference no: EM13981376

Evaluate the following statements.

(a) Offering health insurance by employers as a fringe-benefit reduces the problem of adverse selection.

(b) Too little insurance means that people bear a lot of risk, too much insurance means that people will take inadequate care!

(c) A limited warranty is a signal that the product is not a "lemon." Sears offers satisfaction guaranteed or your money back on its Craftsman tools. Discuss the pros and cons of this unconditional warranty.

(d) High switching costs locks-in consumers from buying substitute goods that may be cheaper.

Reference no: EM13981376

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