I’m studying for my Accounting class and need an explanation.
The question to be answered for the essay is:
Define moral hazard in a financial sense. What must be present for moral hazard to arise? Describe the moral hazard that occurred with the Great Recession of 2007 – 2009. How could this type of behavior be avoided in the future?
The text book needed to be referenced:
Financial Management: Concepts and Applications
Stephen Foerster, 2015