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What two factors are absolutely necessary to drug use and abuse? Are they sufficient, each by itself? Explain.
Incentive Bias
The tendency of an individual or entity to act in a way that is more favorable for their interests due to the promise of a reward or bonus.
Incentive Fee
A fee paid to a fund manager based on performance; typically a percentage of the fund's profits.
Risk-free Interest Rate
The yield from an investment that carries no risk of losing money, often linked to government securities.
Exercise Price
The predetermined price at which the option holder can buy (call option) or sell (put option) the underlying security.
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