Moral hazard is an information asymmetry problem that arises after contracts are signed.

Name: Moral hazard is an information asymmetry problem that arises after contracts are signed.
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Question

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Moral hazard occurs when one party to a contract can take actions that are hidden from or not costly to them but are costly to the other party, and these actions typically occur after the contract has been signed, making it an issue of information asymmetry post-contract.

Moral Hazard Is an Information Asymmetry Problem That Arises After