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If there were no asymmetry in the information that a borrower and a lender had, could there still be a moral hazard problem?

Sagot :

Yes, if there were no asymmetry in the information that a borrower and a lender had, there could still be a moral hazard problem.

There could still be a moral hazard problem if there were no asymmetry in the information that a borrower and a lender had. This is because even if you know that a borrower is taking actions that might jeopardize paying off the loan, you must still stop the borrower from doing so.

Moral hazard problem usually occurs when there is asymmetric information between two parties, such as borrowers and lenders, and a change in the behavior of one party occurs after an agreement between the two parties is reached.

Hence, to learn more about Moral hazard here:

https://brainly.com/question/26367615

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