3. Individual Problems 20-3 Lightweight personal locator beacons are now available to hikers, making it easier for the Forest Service's rescue teams to locate those lost or in trouble in the wilderness. True or False: Forest Service costs will likely fall due to moral hazard. True False

False

Explanation:

Moral Hazard refers to the tendency of people or entities to take on more risk if they know they will be saved from it.

With the Forest Service now making locator beacons available for hikers, the result will be that more hikers will be emboldened to hike further in the wilderness or into more dangerous areas knowing that should they get in trouble, the rescue teams will locate them faster. It will also mean that more hikers will start coming to the forest because they feel they can hike and be found easily if they get into trouble.

These 2 things will mean that the Forest Service will both have to conduct more rescue missions and maybe hire more personnel as a result of the increased number both of which will increase their costs not reduce them.

answer///supply is elastic, and demand is inelastic;