To decrease anxiety in its most accomplished teachers,a school decides to offer them tenure,to help them concentrate on teaching better.Instead it notices that even the best of the teachers started to get sloppy with their work.The school did not foresee
A)Adverse selection
B)Moral hazard
C)All of the above
D)None of the above

Question

​To decrease anxiety in its most accomplished teachers,a school decides to offer them tenure,to help them concentrate on teaching better.Instead it notices that even the best of the teachers started to get sloppy with their work.The school did not foresee
A)​Adverse selection
B)Moral hazard
C)All of the above
D)​None of the above

Quizplus · Accepted Answer

Moral hazard refers to the situation where people tend to take more risks or be less careful when they are protected from the consequences of their actions. In this case, the teachers are protected from losing their job, so they may feel less motivated to put in the effort required to maintain their high level of teaching. This can result in sloppy work and decreased performance, despite the tenure being offered as a means to decrease anxiety and improve performance. Adverse selection, on the other hand, refers to situations where one party has more information than the other party, resulting in one party being disadvantaged. This does not seem to be applicable in this scenario.

​To Decrease Anxiety in Its Most Accomplished Teachers,a School Decides

To Decrease Anxiety in Its Most Accomplished Teachers,a School Decides