Moral hazard is a problem associated with debt and equity contracts arising fromthe lender's relative lack of information about the borrower's potential returns and risks of his investment activities.the lender's inability to legally require sufficient collateral to cover a 100 percent loss if the borrower defaultsthe borrower's lack of incentive to seek a loan for highly risky investments.the borrower's incentive to undertake highly risky investments.none of the above.