Picard Orchards Requires a $100,000 Annual Loan in Order to Pay

question 21

Multiple Choice

Picard Orchards requires a $100,000 annual loan in order to pay laborers to tend and harvest its fruit crop. Picard borrows on a discount interest basis at a nominal annual rate of 11 percent. If Picard must actually receive $100,000 net proceeds to finance its crop, then what must be the face value of the note?

• A) $111,000
• B) $100,000
• C) $112,360
• D) $ 89,000
• E) $108,840

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Definitions:

Conventional

Adhering to accepted standards or practices; typical or expected behavior or way of doing things.

Kohlberg

Refers to Lawrence Kohlberg, an American psychologist best known for his theory of stages of moral development.

Stealing Behavior

The act of taking someone else’s property without permission or legal right and without intending to return it, recognized as a violation of social norms and laws.

Gilligan's Approach

An ethical theory and approach to moral development emphasizing the importance of relationships, care, and empathy, developed by Carol Gilligan.