Asked by Arpitha chowdary on Sep 24, 2024
Verified
Which is NOT an example of moral hazard
A) people eat less at all-you-can-eat buffets
B) loggers clear-cut a tract of land when paying a fixed price rather than when paying per tree felled
C) Drivers of heavier,safer cares are more likely to run stop signs
D) workers on commission work harder than those paid an hourly wage
Moral Hazard
The situation where one party is likely to take risks because the negative consequences of the risk will fall on another party.
All-You-Can-Eat Buffets
Dining establishments that offer customers unlimited food for a single fixed price, promoting consumption without restriction.
Heavier
Describing objects of greater weight or having more serious or profound impact.
- Understand the concept of moral hazard, including its causes and consequences.
- Recognize examples of moral hazard in everyday life and business practices.
Verified Answer
Learning Objectives
- Understand the concept of moral hazard, including its causes and consequences.
- Recognize examples of moral hazard in everyday life and business practices.
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