Use the Information Below to Answer the Following Questions) -What Is the Average Payoff for the 5-Year ARM?
A)

question 24

Multiple Choice

Use the information below to answer the following questions) . 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 average payoff for the 5-year ARM?

• A) $ 49,514
• B) $ 52,015
• C) $ 53,395
• D) $ 51,641

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Definitions:

Subconscious

The part of the mind that is not currently in focal awareness but influences thoughts and behaviors.

Defense Mechanism

Psychological strategies unconsciously used to protect oneself from anxiety and internal conflict.

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in psychological terms, is transferring feelings or actions from the original object of those emotions to another target.

Projection

Attributing one’s own thoughts, feelings, or motives to another person.