Concept #1: Solutions to Informational Problems: Signaling

Concept #2: Solutions to Informational Problems: Screening

Practice: Jen has a family history of medical problems, which leads her to purchase health insurance. Her friend, Mark, has a healthier family, decides not to buy health insurance. This is an example of:

Practice: Safe Times Insurance requires a medical examination for all applicants for medical insurance. Those with significant preexisting conditions are charged more. This is an example of: