For years, the rising price of college tuition has outpaced everything else, even healthcare. For this week's discussion, you are to use the concepts that you see in Section 5 of your textbook, as well as in the videos below, and apply them. Please pay special attention to the Adverse Selection and Moral Hazard problems involved with Student Loans., then answer the following three questions: 1. The "law of demand" states that as the price of something rises, less of it will be demanded, and yet even though the price of college has skyrocketed in recent years the demand has not dropped at all. What factors might be leading to this situation? 2. There are some in politics today who are pushing for the forgiveness/cancellation of student loan debt. What moral hazard implications does such a move create? 3. The authors of the text state that Adverse Selection arises when one party to a transaction is better informed than the other. Within the lending business, banks and other lenders have developed various "screening" methods to distinguish low-risk from high-risk borrowers in such things as car loans and mortgages. However, such "screening" methods do not seem to exist within the federal government's student loan business. What types of "screens" could be imposed within student loans to protect the taxpayers (the actual lenders in this) from the defaults seen in student loans today? Please number your answers to these as 1,2,3. Video #1: "The Cost of College in 4 Minutes" (4:05m)