If the Costs of Performing a Contract Have Risen So

question 30

Multiple Choice

If the costs of performing a contract have risen so unexpectedly and dramatically that performance would result in a substantial loss, the contract may be discharged on the grounds of:

• A) commercial impracticability.
• B) commercial impossibility.
• C) economic frustration.
• D) economic stability.

---

Definitions:

Unsystematic Risks

The portion of risk in an investment that is attributable to the specific circumstances of an individual company or industry.

Efficient Frontier

A concept in portfolio theory where an investment portfolio is said to be efficient if it offers the highest expected return for a given level of risk.

Volatility

A statistical measure of the dispersion of returns for a given security or market index, indicating how much the price of a security, derivative, or index fluctuates.

Stock Betas

An index for determining the degree of volatility, or built-in risk, that a security or a portfolio encounters in comparison with the market at large.