In Ontario,the insurance industry charges a higher rate to most young single male drivers.This is an example of

Question

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This is an example of statistical discrimination, as the insurance industry is using statistical data to predict risk based on demographic characteristics such as age, gender, and marital status. There may be a higher frequency of accidents or claims for young single male drivers, leading to higher premiums. This is not necessarily due to individual risk factors, but based on broad statistical trends. Adverse selection refers to the tendency for higher-risk individuals to seek out insurance, while asymmetric information refers to situations where one party has more information than the other. Risk-neutral and risk-loving behavior refer to an individual's attitude towards risk, which is not relevant in this scenario.

In Ontario,the Insurance Industry Charges a Higher Rate to Most