When the Assumption of Equally Likely Outcomes Is Used to Assign

question 4

Multiple Choice

When the assumption of equally likely outcomes is used to assign probability values, the method used to assign probabilities is referred to as the _____ method.

• A) relative frequency
• B) subjective
• C) probability
• D) classical

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Definitions:

Present Value

The value today of a future money sum or cash flow stream, determined by a specified return rate.

Cash Flows

The comprehensive sum of cash being moved into and away from a business, critically impacting its financial agility.

Financial Calculator

A specialized calculator designed to perform financial functions including interest rates, payments, investment value calculations, and other financial metrics.

Present Value

The current equivalent value of a future stream of payments or a single financial sum, using a specific return rate.