If the Cost of Capital Is 8% Per Year, What

question 14

Multiple Choice

If the cost of capital is 8% per year, what is the discount factor for a cash flow occurring in 4 years?

• A)0.7350
• B)1.3605
• C)1.0800
• D)0.9259

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Definitions:

Robert Rescorla

An American psychologist known for his work on the involvement of cognitive processes in classical conditioning, especially the contingency theory of learning.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired; a response that is initially elicited by the second stimulus is eventually elicited by the first stimulus alone.

Cognitive Focus

Concentration on or dedication of mental resources towards specific thoughts, tasks, or stimuli.

Spontaneous Recovery

The recurrence of an extinguished response as a function of the passage of time.