Explain the five ways in which moral hazards takes place (explain with graph if possible).
Many economists point to moral hazard as the primary reason underlying rising health care costs in t Show more Many economists point to moral hazard as the primary reason underlying rising health care costs in the United States. A) Explain the general argument behind moral hazard. B) Explain the five ways in which moral hazards takes place (explain with graph if possible). C) How does price elasticity of demand influence the moral hazard problem? D) Explain how an insurer could reduce the scope of the moral hazard problem by introducing a consumer copayment. E) What two considerations determine the optimal copayment rate. Show less
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