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In the Case of a Moral-Hazard Problem, Which of the Following

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Multiple Choice

In the case of a moral-hazard problem, which of the following is not a way for the principal to encourage the agent to act more responsibly? The principal could


Definitions:

Medicaid

Medicaid is a government-funded program in the United States that provides health coverage to eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities.

Dependent Children

Minors who rely on their parents or guardians for financial support, care, and shelter.

Pregnant Women

Women carrying one or more offspring, typically over a period of 40 weeks, from conception to childbirth.

Buttress Roots

Large, above-ground roots that provide physical support to tall trees, often found in nutrient-poor rainforest soils.

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