Moral hazard occurs when one party to a contract changes his behavior in response to that contract and thus passes on costs of that behavior to the other party.
Answer the following statement true (T) or false (F)
True
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Market income is defined as wages, interest, rent, and profit earned in factor markets plus cash payments to households by the government
Indicate whether the statement is true or false
Are there any cases where a monopoly is beneficial to the economy?
What will be an ideal response?
Which of the following will reduce consumer expenditures?
A) a decrease in expected future income B) a decrease in interest rates C) a decrease in the price level D) a general increase in housing prices
All else equal, which of the following would increase the unemployment rate? (i) an increase in the number of women who return to work after being stay-at-home mothers (ii) a preference among older men to retire early (iii) an increase in the maximum number of weeks for which someone can receive government unemployment benefits (iv) an increase in the number of previously unemployed women who
stop looking for work and become discouraged workers a. (i) and (ii) only b. (iii) only c. (ii) and (iii) only d. (ii), (iii), and (iv) only