Asymmetric information may result in adverse selection and moral hazard problems in various industries such as the health insurance industry, the automobile insurance industry, the life insurance industry, and the mortgage industry, etc. Prior to beginning work on this assignment, read Cardon and Hendel's article, Asymmetric Information in Health Insurance: Evidence from the National Medical Expenditure Survey(Links to an external site.), and address the following components:

• Evaluate the causes of asymmetric information in the healthcare industry.
• Analyze potential adverse selection and moral hazard problems in the healthcare industry.
• How can health insurance providers reduce or resolve the adverse selection and moral hazard problems?