Ashland Oil
ECON question please homework help?
I do not know what to answer these questions. Can you help me? 1. (Terminals Company) Ashland Oil, Inc., buys its crude oil on the market. Larger oil refiners, such as Texaco, to drill for their raw oil.Why own some oil companies to drill for their crude oil and the other to buy crude oil on the market? 5. (Adverse selection and moral hazard) Describe the problems faced by health insurance companies as a result of selection and random morale. How insurance companies try to reduce these problems? 6. (Signage) Give an example of signaling in each of the following situations. A. Choosing a doctor b. Applicable to higher education
Just my suggestions: 1. - If you want to drill oil, you need a oil fields, so if you do not and I have the refinery, you must purchase crude oil on the market - Oil Drilling is capital and technology demanding and permits are only on major fields So, I think small business can operate only refinery and large oil drilling, or both 2. some examples of moral hazard - if you're sure you can smoke or sports adrenaline because you know that the company incurred costs Insurance in trouble ... IC can offer bonuses or discounts if you do not smoke and unless accident during sport insurance adverse selection - if you're healthy, you have the motivation to make sure small, so that IC is only people who are not so health, they are expensive for Comany, So it must increase rates discourage other people, including almost healty of this resolution is to make sure the screening and differentiating insurance rates 3. signal is a medical diploma on the wall of its application to gs if you had some good results (in some contests or almost) you can MANTION in your resume or cover letter, so poor that you mention do not you take a part in this subject at all
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