Moral Hazard Occurs When

question 303

Multiple Choice

Moral hazard occurs when

• A)an employer closely monitors an employee.
• B)two people consider a trade with each other and one person has relevant information about some aspect of the product's quality that the other person lacks.
• C)an employee lacks an incentive to promote the best interests of the employer, and the employer cannot observe the actions of the employee.
• D)an employee closely monitors the actions of her employer.

---

Definitions:

Regimented

Strictly controlled and organized, often with a focus on precise and orderly management or procedure.

Postmodernism

A broad movement that developed in the mid- to late-20th century across philosophy, the arts, architecture, and criticism, marked by a skeptical, relativist attitude toward culture, literature, art, philosophy, history, linguistics, and economics.

Father Figures

Male individuals who provide guidance, support, care, or mentorship in the absence of a biological father, or alongside the father, playing a significant role in a person's development.

Erosion of Authority

Describes the declining influence or power of traditional institutions or figures of authority in society.