An example of moral hazard is
A)people drive as carefully in icy conditions with antilock brakes as without
B)people drive less safely with more airbags than 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 as carefully in icy conditions with antilock brakes as without
B)people drive less safely with more airbags than 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 situation where individuals take on more risks because they are protected from the consequences of their actions. Choice B is an example of moral hazard because people may be more reckless when driving if they feel safer with airbags, which can lead to more accidents.

​An Example of Moral Hazard Is

An Example of Moral Hazard Is