When borrowers engage in activities that reduce the probability of loans being paid back to lenders, it is the problem of?

a) moral hazard

b) adverse selection

It occurs

a) after

b) before

the transaction?

When the funds are lent to those among potential borrowers who are actually the bad credit risks, it is the problem of?

moral hazard

adverse selection

It occurs

a) before

b) after

the transaction.?

Both these problems are caused due to?

a) asymmetric information

b) symmetric information

Due to these problems?

a) lenders and borrowers may lower the amount of transactions

b) lenders may decide not to make any loans

c) borrowers may decide not to take any loans

.