Cheryl graduated from college a month ago and is now without work. She accepted a job that will start next month. Today, Cheryl is

How can a bond investor hedge against a possible bear market in bonds?

A) sell futures contracts on Treasury notes B) buy futures contracts on Treasury notes C) going long in the spot market D) going short in the spot market

If good salespeople are extremely risk averse, then a choice between a fixed-fee contract and a contingent contract

A) avoids a moral hazard. B) will result in all job candidates choosing the contingent contract. C) will result in an efficient contract. D) may not be a good screening device.