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Explain why seniors often earn lower grades in their last semester before graduation (hint: incentive problem).

Explain why seniors often earn lower grades in their last semester before graduation (hint: incentive problem).

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Seniors tend to earn lower grades in their last semester of graduation because to them, the benefit of working hard and earning high grades for that one last semester is not greater than the cost of exerting the effort. There is often no incentive to motivate seniors to work hard during their last semester because it is not going to change the outcome of their graduation.

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