Use the Information Given Below to Answer the Following Questions)

question 20

Multiple Choice

Use the information given below to answer the following questions) . Below is a payoff table that lists three mortgage options: $$\begin{array} { | l | l | l | l | } \hline & { \text { Outcome } } \\\hline \text { Decision } & \text { Rates Rise } & \text { Rates Stable } & \text { Rates Fall } \\\hline \text { 2-year ARM } & \$ 66,645 & \$ 43,650 & \$ 38,560 \\\hline \text { 5-year ARM } & \$ 62,857 & \$ 47,698 & \$ 42,726 \\\hline \text { 25-year fixed } & \$ 52,276 & \$ 52,276 & \$ 52,276 \\\hline\end{array}$$
-What is the maximum opportunity loss incurred for the 25-year fixed decision?

• A) $ 8,626
• B) $ 13,716
• C) $ 14,369
• D) $ 10,581

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Definitions:

Video Card

A hardware component in computers designed to render images and videos to be displayed on a monitor.

Expansion Card

A hardware component that adds functionality to a computer by plugging into its expansion slot, enhancing its capabilities.

RAM

Random Access Memory, a type of computer memory that is used to store data temporarily while a computer is running, facilitating quick access by the CPU.

ESATA

External Serial Advanced Technology Attachment, an extension of the SATA interface to connect external storage devices to a computer.