Describe the Major Tools and Criteria for Decision Making -What Is the Worst Payoff Rate for the 5-Year ARM

question 16

Multiple Choice

Describe the major tools and criteria for decision making. Use the information below to answer the following question(s) . Below is a payoff table that lists four mortgage options: $$\begin{array} { | l | l | l | l | } \hline &{ \text { Outcome } } \\\hline \text { Decision } & \text { Rates Rise } & \text { Rates Stable } & \text { Rates Fall } \\\hline \text { 1-year ARM } & \$ 66,645 & \$ 43,650 & \$ 38,560 \\\hline \text { 3-year ARM } & \$ 62,857 & \$ 47,698 & \$ 42,726 \\\hline \text { 5-year ARM } & \$ 55,895 & \$ 50,894 & \$ 48,134 \\\hline \text { 30-year fixed } & \$ 52,276 & \$ 52,276 & \$ 52,276 \\\hline\end{array}$$
-What is the worst payoff rate for the 5-year ARM?

• A) $ 50,894
• B) $ 48,134
• C) $ 51,641
• D) $ 55,895

---

Definitions:

Categorical Proposition

A statement that affirms or denies something unconditionally, often structured in standardized forms.

Placenta

An organ that develops in the uterus during pregnancy, providing oxygen and nutrients to the growing fetus while removing waste products.

Childbirth

The act of a baby being born, which includes the labor and delivery stages.

Cesarean Section

A surgical procedure used to deliver a baby through incisions in the abdomen and uterus, often performed when vaginal delivery would put the baby or mother at risk.