Solutions to Moral Hazard Include

question 20

Multiple Choice

Solutions to moral hazard include:

• A)offering salespeople in stores a straight salary rather than a commission on sales.
• B)setting up many stores and restaurants that are part of a national chain as franchises,with the owner undertaking quite a lot of risk.
• C)allowing property owners to over insure their buildings.
• D)diversification.

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Definitions:

Electrical Interlocking Circuit

A safety mechanism in electrical engineering designed to prevent dangerous combinations of actions by controlling the sequence of operations.

Pilot Light

An indicator light used on control panels or equipment to indicate operational status or to highlight warnings to the operator.

Thermocouples

Devices that measure temperature based on the voltage generated at the junction of two different metals.

PLC Programmed Rung

A specific command or instruction set within a Programmable Logic Controller that executes part of the control process as depicted in ladder logic.