Forward contracts
A)are highly liquid.
B)entail small information costs.
C)provide little risk sharing.
D)are subject to default risk.

Name: Forward contracts A)are highly liquid. B)entail small information costs. C)provide little risk sharing. D)are subject to default risk.
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Question

Quizplus · Accepted Answer

Forward contracts are not highly liquid and entail significant information costs. Moreover, they provide limited risk sharing and are subject to significant default risk.

Forward Contracts