Which of the following is the term used to describe the tendency of market participants to engage in riskier behavior if they believe that they will not have to bear all of the costs of engaging in this behavior.
A) default
B) sovereignty
C) moral hazard
D) dilemma behavior
E) political risk

Question

Quizplus · Accepted Answer

Moral hazard refers to the situation where individuals or institutions may take on more risk because they believe that they will not have to bear the full consequences of their actions, often due to some form of insurance or bailout expectation.

Which of the Following Is the Term Used to Describe