In the Abecedarian Program a Particularly Notable Effect Was Found

question 161

Multiple Choice

In the Abecedarian Program a particularly notable effect was found for children whose mothers were mentally retarded. Every one of these children who had early intervention had attained an IQ at least _____ points higher than those in the control group.

• A)5
• B)10
• C)15
• D)20 or more

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Definitions:

Interest Tax Shield

A reduction in taxable income for an individual or corporation achieved by deducting interest paid on their loans.

Debt-Equity Ratio

Debt-Equity Ratio measures a company's financial leverage, calculated by dividing its total liabilities by its stockholders' equity.

Capital Asset Pricing Model

A model that describes the relationship between systematic risk and expected return for assets, particularly stocks, used to assess the risk of adding a new asset to a portfolio.

M&M Proposition II

This financial theory, originating from Modigliani and Miller, states that a firm's cost of equity increases as the firm increases its level of debt financing, holding everything else constant.