When Sam Makes an Agreement and Then Behaves After the Agreement

question 21

Multiple Choice

When Sam makes an agreement and then behaves after the agreement in a way to increase his benefits and harm then other party to the agreement,Sam is illustrating

• A) moral hazard.
• B) adverse selection.
• C) signaling.
• D) the cost of contracting.
• E) a pooling equilibrium.

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Definitions:

Response Set

A tendency of some respondents to answer survey questions in a particular way, regardless of the content.

Representative Sample

A subset of a population that accurately reflects the members of the entire population.

Young Adults

Individuals in their late teens to early thirties, often considered to be in a transitional phase from adolescence to adulthood, facing unique developmental tasks and challenges.

Sample

A subset of individuals or items selected from a larger population for the purpose of statistical analysis.