Moral hazard is a barrier to financing global growth because

Question

Quizplus · Accepted Answer

Moral hazard refers to the possibility of a borrower taking on riskier behavior than what was agreed upon with the lender, once the borrower receives the funds. This can be a barrier to financing global growth because it creates uncertainty for investors, who may be hesitant to invest in firms for fear that the funds will be used for purposes outside of what was agreed upon. This, in turn, can limit the amount of available financing for global growth initiatives.

Moral Hazard Is a Barrier to Financing Global Growth Because