Explanation of covariance and contravariance in C#

cov-contra.cs

// Assignment compatibility.   
string str = "test";  
// An object of a more derived type is assigned to an object of a less derived type.   
object obj = str;  

// Covariance.   
IEnumerable<string> strings = new List<string>();  
// An object that is instantiated with a more derived type argument   
// is assigned to an object instantiated with a less derived type argument.   
// Assignment compatibility is preserved.   
IEnumerable<object> objects = strings;  

// Contravariance.             
// Assume that the following method is in the class:   
// static void SetObject(object o) { }   
Action<object> actObject = SetObject;  
// An object that is instantiated with a less derived type argument   
// is assigned to an object instantiated with a more derived type argument.   
// Assignment compatibility is reversed.   
Action<string> actString = actObject;