An example of moral hazard is
A)people drive less carefully in icy conditions with antilock brakes than without
B)people drive as safely with more airbags as without
C)football players avoid 'spearing' with their heads even with safer helmets
D)people read the medicine warnings as carefully when self-medicating as with a doctor's prescription

Question

​An example of moral hazard is
A)​people drive less carefully in icy conditions with antilock brakes than without
B)people drive as safely with more airbags as without
C)football players avoid 'spearing' with their heads even with safer helmets
D)​people read the medicine warnings as carefully when self-medicating as with a doctor's prescription

Quizplus · Accepted Answer

Moral hazard refers to the increased risk-taking behavior by individuals or institutions because they are insured or protected against losses. In this case, people drive less carefully in icy conditions with antilock brakes than without, because they feel safer with the technology and are less likely to suffer a loss.

​An Example of Moral Hazard Is

An Example of Moral Hazard Is