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This explains the popularity of insurance, where individuals pay a premium for the comfort of knowing their financial losses will be covered.
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This principle applies equally to those who may be considering gambling as it does to anyone managing their finances.
The layout of the casino floor, the positioning of the games, the design of the slot machines, all contribute to a carefully constructed ecosystem that encourages play.
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However, insurance markets can also be prone to moral hazard and adverse selection, where individuals take more risks or misrepresent their risk profile after obtaining insurance coverage.
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Privacy practices may vary, for example, based on the features you use or your age.
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