A safe drive is likely to prefer an auto insurance policy that has a ________ deductible and a ________ premium.
A) high; high
B) high; low
C) low; high
D) low; low
E) None of the above answers are correct because private information has no effect in the market for auto insurance.

Question

Quizplus · Accepted Answer

A safe driver is likely to prefer a high deductible and a low premium because they expect to make fewer claims, thus benefiting from lower monthly payments.

A Safe Drive Is Likely to Prefer an Auto Insurance