Economics Multiple Choice Question – 20 August 2017

Which ONE of the following is an example of a moral hazard?

Select ONE answer:

  1. Failing to regularly service a car
  2. Leaving an insured bicycle unlocked
  3. Installing a home alarm system
  4. A commission-based salary
  5. Driving above the speed limit

Give three more examples of a moral hazard?
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 2 – moral hazard is a lack of incentive to guard against risk where one is protected from its consequences, e.g. by insurance.

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