In a contingent contract
A) the risk neutral party bears the risk.
B) monitoring is not possible.
C) the principal will be at a disadvantage.
D) the payoffs are dependent upon another variable, such as revenue or profit.
D
You might also like to view...
Which of the following statements regarding futures is true?
A) trading futures contracts on agricultural and mineral commodities makes up a majority of all trading. B) trading in financial futures involves more transactions than trading in commodity futures. C) futures trading is allowed only for financial assets. D) futures trading is allowed only for commodities.
Suppose Warren Buffet withdraws $1 million from his checking account at Chase Bank. If the required reserve ratio is 20 percent, what is the maximum change in deposits in the banking system?
A) -$5 million B) -$4 million C) -$200,000 D) $1 million E) $5 million