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The Risk That the Party on the Other Side of a Financial

question 89

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The risk that the party on the other side of a financial transaction fails to meet its obligation is called


Definitions:

Probability

The likelihood of a particular event happening.

Moral Hazard

A situation in which one party engages in risky behavior or fails to act in good faith because another party bears the consequences or costs.

Taxi Driver

An individual who operates a car for hire to transport passengers as a profession.

Piece-rate Garment Worker

describes an employee in the clothing manufacturing sector who is paid based on the number of pieces or units they produce, rather than receiving an hourly wage.

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