2018 2019 Insured? Average Insured? Average Expenditures $4,000 Expenditures Chemistry No Yes $6,000 Professors Accounting No $2,000 No $2,000 Professors a.) Is there evidence of moral hazard in this market? How do you know?

2018 2019 Insured? Average Insured? Average Expenditures $4,000 Expenditures Chemistry No Yes $6,000 Professors Accounting No $2,000 No $2,000 Professors a.) Is there evidence of moral hazard in this market? How do you know?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Moral Hazard

The moral is a person's behavior towards himself /herself, society, organization, and others. Hazard is something that is happening and is not good. A person may be morally good or bad. It depends on his attitude, ethics, integrity, and values. A person may have the highest reverence for money to that for the truth. In this case, the person may lie and it is said that the person is morally bad.

Question

a.) Is there evidence of moral hazard in this market? How do you know ?

2018
2019
Insured? Average
Insured? Average
Expenditures
$4,000
Expenditures
Chemistry
No
Yes
$6,000
Professors
Accounting
No
$2,000
No
$2,000
Professors
a.) Is there evidence of moral hazard in this market? How do
you know?

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