Need your assistance.

In a principal-agent problem, if the contract implies that the more risk-averse agent will bear less risk, we can say that this contract exhibits

a)risk sharing is not optimal because risk-neutral agents should face no risk.

b)efficiency in risk-bearing.

c)risk sharing is not optimal because all risk should be transferred to the most risk-averse agent.

d)risk sharing is not optimal because the less risk-averse (or risk-neutral) agent should bear none of the risk.

C - Marked as incorrect

Author A accepts a $5,000 advance and a 10% royalty after 5,000 books are sold. Author B foregoes the advance and negotiates for a 15% royalty on all books sold. Author C decides to self publish his book and keep 50% of all sales revenue. In what order of risk aversion (from most to least) would you rank these authors?

a)Author A, Author B, Author C

b)Author C, Author B, Author A

c)Author A, Author C, Author B

d)Author B, Author A, Author C

B - Marked as incorrect

In 2008, foreclosures reached a record high. Which of the following is NOT a possible reason for foreclosures?

a)Many mortgages were initiated on secondary and investment homes.

b)Some mortgages were adjustable rate mortgages which might have dramatically increased monthly payments for some.

c)Many mortgages were initiated without a down payment.

d)Property values were increasing too fast.

C - Marked as incorrect