Recall the Application About How Having Car Insurance Affects Driving

question 6

Multiple Choice

Recall the Application about how having car insurance affects driving behavior to answer the following question(s) .
-Recall the Application.What does the theory of moral hazard suggest when it comes to car insurance among insured and uninsured drivers?

• A) The insured driver, who bears less than the full cost of a collision, will drive less carefully than the uninsured driver.
• B) The insured driver, who bears more than the full cost of a collision, will drive more carefully than the uninsured driver.
• C) The insured driver, who bears less than the full cost of a collision, will drive more carefully than the uninsured driver.
• D) The uninsured driver, who bears less than the full cost of a collision, will drive less carefully than the insured driver.

---

Definitions:

New Venture

An enterprise that is newly established, focusing on addressing a market demand by offering an innovative product, service, or platform.

Expansion

The process of a business enlarging its operations, typically through increased production capabilities, market reach, or product lines.

New Market

An emerging sector or industry where a company can expand its operations or products to generate growth.

Interest Expense

The cost incurred by an entity for borrowed funds over a period of time.