The Legal Environment for Public Employees Differs from Private Sector

question 14

Multiple Choice

The legal environment for public employees differs from private sector employment because public employees:

• A)are covered by civil service laws
• B)generally enjoy a property interest in their jobs
• C)have speech and other substantive constitutional rights
• D)all of the above
• E)none of the above

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Definitions:

Moral Hazard

The risk that one party to a transaction has not entered into the contract in good faith or has an incentive to take unusual risks because the costs are not borne by that party.

Flat Salary

A flat salary is a fixed amount of pay received by an employee, regardless of the number of hours worked or the quantity of output.

Car Dealership

A business that sells new or used cars at the retail level, typically based on a dealership contract with an automaker or its sales subsidiary.

Asymmetric Information

A situation where one party in a transaction has more or superior information compared to another, potentially leading to an imbalance in decision-making, similar to adverse selection.