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 is 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 higher deductible because they anticipate fewer claims, which can lead to lower premiums. This choice balances the risk they're willing to accept with the cost of insurance.

A Safe Drive Is Likely to Prefer an Auto Insurance