In a Derivative Transaction

question 51

Multiple Choice

In a derivative transaction:

• A)The dollar amount of the transaction increases as the contract date approaches.
• B)The risk is less than if actually purchasing the underlying asset.
• C)What one person gains is what the other person loses.
• D)There is always a futures contract.

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Definitions:

Operant Conditioning

A conditioning technique that aims to modify behavior magnitude by employing reinforcement strategies or punishment tactics.

Extinction

In psychology, the gradual weakening and disappearance of a conditioned response when the conditioned stimulus is no longer paired with the unconditioned stimulus.

Variable-Ratio Schedule

A reinforcement schedule where a response is reinforced after an unpredictable number of responses, making it very resistant to extinction.

Fixed-Interval Schedule

A type of reinforcement schedule in operant conditioning where rewards are delivered at fixed time intervals, provided the correct response is made.