A Person Starting to Drive More Recklessly After Signing a Contract

question 84

Multiple Choice

A person starting to drive more recklessly after signing a contract with an automobile insurance company is an example of

• A)adverse selection.
• B)moral hazard.
• C)signaling.
• D)screening.

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Definitions:

Operant Conditioning

A behavioral modification process where the degree of an activity is transformed by gratification or corrections.

Reinforced

Strengthened or emphasized, especially in the context of behavior that is encouraged by rewards or positive outcomes.

Law Of Effect

A principle stating that behaviors followed by positive outcomes tend to be repeated, while those followed by negative outcomes are less likely to be repeated.

Neutral Stimulus

A stimulus that initially produces no specific response other than focusing attention, until it is associated with an unconditioned stimulus.