One Way That Employers Respond to the Moral-Hazard Problem Is

question 14

True/False

One way that employers respond to the moral-hazard problem is by monitoring their employees.

---

Definitions:

Rights Offering

A financial mechanism in which current shareholders are given the right to purchase additional shares of the company at a specified price before the shares are offered to the public.

Market Price

The present cost for purchasing or selling a good or service in a specific market.

Subscription Price

The set price at which existing shareholders can purchase additional shares of stock in a company, often during a rights offering.

Subscription Price

The price at which existing shareholders can buy more shares of a company, typically during a rights issue.