Which of the Following Illustrates the Concept of Delay of Gratification

question 47

Multiple Choice

Which of the following illustrates the concept of delay of gratification?

• A) preferring $500 now rather than $1,000 one year from now
• B) preferring $1,000 one year from now rather than $500 now
• C) preferring a 1-in-1,000 chance at $10,000 rather than $10 for certain
• D) preferring $10 for certain rather than a 1-in-1,000 chance at $10,000

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Definitions:

Proof of Loss

A formal statement made by a policyholder to an insurance company detailing a claimed loss's circumstances and amount.

Fire Insurance Policy

A contract between an individual or entity and an insurance company, offering protection against losses or damage from fire in exchange for premium payments.

Insured

An individual or entity covered by an insurance policy, receiving protection against specified risks.

Insurance Contract

A legally binding agreement between an insurance company and the policyholder, detailing the terms under which the insurer agrees to compensate the insured for specific losses.