You Need to Borrow $2,000 Quickly, and the Local Pawn

question 377

Multiple Choice

You need to borrow $2,000 quickly, and the local pawn shop will give it to you if you promise to repay them $200.92 monthly over the next year.

Suppose the pawn shop has more customers than funds. Which capital budgeting technique would allow it to rank potential customers in order to maximize current wealth?

• A) AAR
• B) Payback period
• C) Profitability index
• D) NPV
• E) Discounted payback

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Definitions:

Freudian Terms

Freudian Terms relate to the concepts or terminologies developed by Sigmund Freud in the field of psychoanalysis, focusing on unconscious desires, conflict resolution, and personality development.

Superego

The part of the human psyche in Freudian psychoanalytic theory that represents internalized societal norms and morals, functioning to suppress the urges of the id and to strive for moral perfection.

Id

In psychoanalytic theory, the part of the mind in which innate instinctual impulses and primary processes are manifest.

Personality Development

The growth and evolution of one's personality over time, influenced by genetics, environment, experiences, and individual choices.