Suppose You Buy a Bond with a Face Value of $1,000

question 29

Multiple Choice

Suppose you buy a bond with a face value of $1,000 for $800. What is the interest rate you receive on the bond?

• A) 0.8%
• B) 1.25%
• C) 20%
• D) 25%

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Definitions:

Nativist Theory

The hypothesis that some talents or capabilities are innate or embedded in the brain from birth.

Empiricist Theory

A philosophical perspective emphasizing that knowledge comes primarily from sensory experience and observation rather than inherent ideas.

Observer-Expectancy Effect

refers to a cognitive bias wherein a researcher's expectations influence the participants of an experiment, potentially affecting the outcome.

Mental Age

A measure of an individual's cognitive ability compared to the average cognitive ability of an individual of a specific chronological age.