Standardization of Derivative Contracts

question 3

Multiple Choice

Standardization of derivative contracts:

• A) results in increased risk for the parties involved.
• B) makes them more difficult to understand and therefore leads to increased misuse.
• C) makes the premiums involved with these contracts increase.
• D) leads to greater liquidity and lower risk.

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Definitions:

Progressive Relaxation

A relaxation technique where individual muscles are tensed then relaxed in a sequence to achieve overall relaxation.

Counterconditioning

A behavior therapy technique involving the conditioning of an unwanted behavior or response to a stimulus into a desired behavior by association with a positive action or outcome.

Transference

The process by which emotions, desires, and expectations originally associated with one person are unconsciously redirected towards another person.

Resistance

The refusal to accept or comply with something; the attempt to prevent something by action or argument.