6. Answer which happens, moral hazard or adverse selection, or nothing happens under each of the following situations. [M20]: A driver drives a car rough because s/he has a property insurance of a...

What is the right for M23?

Extracted text: 6. Answer which happens, moral hazard or adverse selection, or nothing happens under each of the following situations. [M20]: A driver drives a car rough because s/he has a property insurance of a car. a. Moral hazard c. nothing b. Adverse selection [M21]: Since a driver cannot distinguish among qualities of cars, s/he may buy a bad one. a. Moral hazard b. Adverse selection c. nothing [M22]: Banks look for lenders, but most customers who apply for loans seem to have difficulty repaying them even in assuming they make an identical effort. a. Moral hazard b. Adverse selection c. nothing [M23]: In the global financial crisis in 2007 and 2008, investment banks assembled complex derivatives and made it difficult to discern the quality. a. Moral hazard b. Adverse selection c. nothing