When one party has the incentive to shirk their responsibilities in a way that harms the other party to the contract it is called:
a. hidden actions
b. hidden characteristics
c. moral hazard
d. adverse selection
c
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Refer to Figure 4-10. Suppose that instead of a price ceiling, the government imposed a price floor of R1. What is the quantity of apartments demanded at the new price?
A) Q1 B) 0 C) Q0 D) Q*
All Nash equilibria consist of Dominant Strategies
Indicate whether the statement is true or false
Which of the following is an example of an investment?
a. A company placing cash reserves in a bank. b. A company buying Yahoo shares. c. A company augmenting its production capacity. d. A company issuing bonus shares.
Consider the production possibilities frontier displayed in the figure shown. The fact that the line slopes downward displays which economic concept?
A. Specialization B. Trade-offs C. Production possibilities D. Efficiency