PLSC EXAM 2 QUESTIONS AND
ANSWERS GRADED A+
What is 'information asymmetry'? - Answer- A situation in a transaction where one party
possesses more information than the other.
How does a deductible differ from a co-payment in health insurance? - Answer- A
deductible is the amount paid before coverage begins, while a co-payment is a fixed fee
paid per service or visit.
What is the distinction between Medicare and Medicaid? - Answer- Medicare is federal
insurance for seniors and the disabled, while Medicaid is public insurance for low-
income individuals.
What does it mean for a program to be 'means-tested'? - Answer- Eligibility for the
program is restricted based on an individual's income level.
What is 'path dependence' in policy? - Answer- The concept that historical choices and
past policies limit or shape current decision-making.
What is a 'community rating' in insurance? - Answer- An insurance pricing method
where the cost is the same for everyone regardless of individual health status or risk.
What is 'bureaucratic drift'? - Answer- When government agencies deviate from the
original goals intended by the policy makers.
What is the purpose of 'Race to the Top'? - Answer- A federal incentive program
providing grants to states that meet specific education reform standards.
How do charter schools differ from traditional public schools? - Answer- Charter schools
are government-funded but operate under independent management.
What are school vouchers? - Answer- Government subsidies that allow students to use
public funds for private school tuition.
What is the 'Broken Windows Theory'? - Answer- The theory that visible disorder and
minor crimes encourage more serious offenses if left ignored.
What is 'Prospect Theory' in the context of decision-making? - Answer- The principle
that people fear losses more than they value equivalent gains.
ANSWERS GRADED A+
What is 'information asymmetry'? - Answer- A situation in a transaction where one party
possesses more information than the other.
How does a deductible differ from a co-payment in health insurance? - Answer- A
deductible is the amount paid before coverage begins, while a co-payment is a fixed fee
paid per service or visit.
What is the distinction between Medicare and Medicaid? - Answer- Medicare is federal
insurance for seniors and the disabled, while Medicaid is public insurance for low-
income individuals.
What does it mean for a program to be 'means-tested'? - Answer- Eligibility for the
program is restricted based on an individual's income level.
What is 'path dependence' in policy? - Answer- The concept that historical choices and
past policies limit or shape current decision-making.
What is a 'community rating' in insurance? - Answer- An insurance pricing method
where the cost is the same for everyone regardless of individual health status or risk.
What is 'bureaucratic drift'? - Answer- When government agencies deviate from the
original goals intended by the policy makers.
What is the purpose of 'Race to the Top'? - Answer- A federal incentive program
providing grants to states that meet specific education reform standards.
How do charter schools differ from traditional public schools? - Answer- Charter schools
are government-funded but operate under independent management.
What are school vouchers? - Answer- Government subsidies that allow students to use
public funds for private school tuition.
What is the 'Broken Windows Theory'? - Answer- The theory that visible disorder and
minor crimes encourage more serious offenses if left ignored.
What is 'Prospect Theory' in the context of decision-making? - Answer- The principle
that people fear losses more than they value equivalent gains.
