________ Is a Type of Political Risk That OPIC Does

question 31

Multiple Choice

________ is a type of political risk that OPIC does NOT cover.

• A) Inconvertibility
• B) Expropriation
• C) War
• D) OPIC covers all of the above.

---

Definitions:

Moral Hazard

The situation where one party is more likely to take risks because another party bears the cost of those risks.

Adverse Selection

A situation where asymmetric information results in high-risk individuals being more likely to participate in a contract or agreement, potentially leading to market inefficiency.

Life Insurance

A contract between an insurer and a policyholder where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person.

Productivity

A measure of the efficiency of a person, machine, system, etc., in converting inputs into useful outputs.