$$\text { Use the linear approximation } ( 1 + x ) ^ { k } \approx 1 + k x \text {, as specified. }$$

question 428

Multiple Choice

$$\text { Use the linear approximation } ( 1 + x ) ^ { k } \approx 1 + k x \text {, as specified. }$$
-Find an approximation for the function $f ( x ) = ( 1 - x ) ^ { 5 }$ for values of $x$ near zero.

• A) \(f ( x ) \approx 1 + 6 x\)
• B) \(f ( x ) \approx 1 + 5 x\)
• C) \(f ( x ) \approx 5 + 5 x\)
• D) \(f ( x ) \approx 1 - 5 x\)

---

Definitions:

Shares Outstanding

The total number of a company's shares that are currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.

Market Value

The existing rate at which an asset or service can be traded in the market.

Incremental Value

The additional or extra value created by undertaking a new project or activity compared to not doing it, often considered in decision-making processes.

All-Equity Firms

Companies that finance their operations without any debt, relying solely on shareholder equity.