Courts' Ability to Enforce Contracts May Create Incentives for Two

question 18

Multiple Choice

Courts' ability to enforce contracts may create incentives for two parties to uphold an agreement when they otherwise would have preferred to defect.By doing so,courts prevent the contracting parties from facing a/an _________________________.

• A) principal-agent problem
• B) coordination problem
• C) Prisoner's Dilemma
• D) unstable coalition
• E) collective-action problem

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Definitions:

Spotlight Effect

The belief that others are paying more attention to one's appearance and behavior than they really are.

Conform

The act of adjusting one's behavior or thinking to align with the standards, norms, or expectations of a group or society.

Highly Extraverted

Describing individuals who are very outgoing, sociable, and active, often seeking stimulation and engagement in social settings.

Anonymous Voting

A voting system where voters' choices are kept secret, protecting their anonymity and preventing influence or retribution.