Plan to Analyze the Value of a Potential Investment by Calculating

question 28

Multiple Choice

plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows.Which of the following would lower the calculated value of the investment?

• A)The cash flows are in the form of a deferred annuity, and they total to $100,000.You learn that the annuity lasts for only 5 rather than 10 years, hence that each payment is for $20,000 rather than for $10,000.
• B)The discount rate increases.
• C)The riskiness of the investment's cash flows decreases.
• D)The total amount of cash flows remains the same, but more of the cash flows are received in the earlier years and less are received in the later years.
• E)The discount rate decreases.

Distinguish between positive and negative emotions in the context of stress.

Understand the Social Readjustment Rating Scale and its application to measuring life stressors.

Recognize the impact of pressure, both to perform and to conform, in stressful situations.

Examine the role of change in stress and its psychological implications.

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Definitions:

Encoding Specificity Principle

The theory that memory retrieval is most effective when the conditions at the time of encoding (such as environment or mental state) match those at the time of retrieval.

Memory Consolidation

The process by which short-term memories are transformed into long-term memories, making them more stable and durable.

Recognizing

The cognitive process of acknowledging and understanding something as being previously seen, known, or experienced.

Mood-Congruent Memory

The tendency to recall memories that are consistent with one's current mood, enhancing mood conformity.