Matching Grants Can Create a Moral Hazard Because ______

question 66

Multiple Choice

Matching grants can create a moral hazard because ______.

• A) the states will only receive a fixed amount of money and must find their own dollars if they want to expand programs
• B) the people responsible for managing the program will be tempted to redirect to favored activities instead of the specified activities
• C) the federal government must raise taxes to pay for the long-term commitments embodied in these programs
• D) people may behave differently or take more risks because they do not have to pay all of the costs of their actions

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Definitions:

Wastage

The act or process of losing resources or materials inefficiently or unproductively.

Revenue Management

The use of analytics and data to predict consumer behavior, optimize product availability and pricing, and maximize revenue growth.

Differential Pricing

Differential pricing is a strategy where a company charges different prices for the same product or service in different markets or segments, based on factors like customer willingness to pay, market demand, or competition.

Supply Chain Surplus

The difference between the value generated by the final product to the end consumer and the costs involved in the supply chain.