Moral Hazard Occurs When

question 22

Multiple Choice

Moral hazard occurs when:

• A)individuals do not do what is in their own best interest.
• B)an individual knows more about the way things are than other people do.
• C)an individual has an incentive to violate his or her morals.
• D)an individual knows more about his or her actions than other people do.

---

Definitions:

Standard Normal

A normal distribution with a mean of zero and a standard deviation of one, used as a basis for comparing other normal distributions.

Area

Area describes the measure of the extent of a two-dimensional surface or shape, expressed in square units.

Continuous Variable

A variable that can take an infinite number of values within a given range, allowing for any value in the range, including fractions and decimals.

Normal Distribution

A bell-shaped frequency distribution curve that is symmetrical about the mean, representing the distribution of many types of data.