An Unconscionable Contract, as Opposed to a Contract of Adhesion

question 6

True/False

An unconscionable contract, as opposed to a contract of adhesion, is one in which a party in a strong position dictates terms to a weaker party as a take-it-or-leave-it proposition

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Definitions:

Barrier Options

A type of option whose existence and payoff depend on whether the underlying asset's price reaches a predetermined barrier level.

Payoffs

The amount received from an investment or financial transaction.

Underlying Asset

The financial asset upon which a derivative's value is based, such as stocks, bonds, commodities, or currencies.

Naked Call Option

An options strategy where an investor sells call options without owning the underlying asset, exposing the seller to unlimited risk.