Moral Hazard played a major role in the government-led development of Latin Amer
ID: 1196204 • Letter: M
Question
Moral Hazard played a major role in
the government-led development of Latin America
the behavior of banks and international finance leading up to the Asian Financial Crisis
the Mexican default of 1982
the return of international finance to Latin America in the 1980s
the government-led development of Latin America
2.the behavior of banks and international finance leading up to the Asian Financial Crisis
3.the Mexican default of 1982
4.the return of international finance to Latin America in the 1980s
Explanation / Answer
Ans B
Moral hazard is a situation in which one party gets involved in a risky event knowing that it is protected against the risk and the other party will incur the cost. The behaviour of banks and international finance leading up to the Asian Financial Crisis was because of moral hazard problem, as banks know they know that central bank will come to rescue them.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.