Question

1

According to Baid, McIntosh, and Ozler (2011), what was the effect of the program on teenagers' likelihood of marriage and pregnancy?

Group of answer choices

All girls that received a cash transfer were less likely to be married or pregnant by the end of the study.

Girls that received a CCT were less likely to be married or pregnant, than those that received a UCT, by the end of the study.

All girls that received a UCT were less likely to be married or pregnant, than those that received a CCT, by the end of the study.

All girls that received a CCT and dropped out from school were less likely to be married or pregnant, than those that received a UCT, by the end of the study.

All girls that received a UCT and dropped out from school were less likely to be married or pregnant, than those that received a CCT, by the end of the study.

2

Suppose that an RCT increases schooling for treated individuals by 0.2 years, and increases long-term earning by 9% from and average of $4,635 per year.

What are the returns to education in this population? The result will be "x%" , enter x with 2 decimals, no need to write "%"._________

3

Moral hazard:

Group of answer choices

Affects inefficient borrowers more than efficient borrowers

Always leads to low effort from a borrower

Occurs when the lender cannot observe the effort of the borrower

All of the options are correct

None of the options are correct

Answer 1

The correct option is (d).

All girls that received a CCT and dropped out from school were less likely to be married or pregnant, than those that received a UCT, by the end of the study.

CCT is the conditional cash transfer and UCT is the unconstitutional cash transfer. The girls receiving CCT were less likely to be pregnant or married than those who received UCT.

2). RCT is Randomized control trials, the RCT increases schooling for treated individuals. The total returns in education would be 18 per cent.

3). The correct option is (c).

All of the options are correct.

The moral hazard occurs due to the information asymmetry. 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.

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