Hardwood Furniture Store Considered Building a Store in a New

question 100

Multiple Choice

Hardwood Furniture Store considered building a store in a new location. The owners and their accountants decided that this was the profitable thing to do. However, soon after they made this decision, both the interest rate and the cost of building the store changed. In which case do these changes both make it less likely that they will now build the store?

• A)Interest rates rise and the cost of building the store rises.
• B)Interest rates rise and the cost of building the store falls.
• C)Interest rates fall and the cost of building the store rises.
• D)Interest rates fall and the cost of building the store falls.

---

Definitions:

Boundary Values

Specific points which are used in software testing to check the behavior of a program at the start or end of a range of acceptable inputs.

Black-Scholes

A mathematical model used to price European options and derivatives by estimating the variation over time of financial instruments.

Standard Deviation

The positive square root of the variance.

Option Theta

A measure of the rate of decline in the value of an option due to the passage of time.