When a Promisor's Performance Is an Express Condition of the Promisee's

question 72

True/False

When a promisor's performance is an express condition of the promisee's duty to perform,that performance must meet a strict performance standard.

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Definitions:

Moral Hazard

The situation in which an individual or entity is more likely to take risks because the potential costs will not be borne by them but by another party.

Efficient Behavior

Efficient behavior refers to actions that maximize the desired outputs or results with the least amount of wasted effort or resources.

Insurance Industry

The sector of the economy that provides coverage against financial loss, including various types of insurance products and services.

Moral Hazard

The risk that one party to a contract can change their behavior to the detriment of another after the contract has been concluded.