Suppose That Anabelle and Roger Are Two Lonely People

question 59

Multiple Choice

Suppose that Anabelle and Roger are two lonely people. Anabelle seeks to stave off loneliness by forming "relationships" with her favorite celebrities (reading about their lives in Us magazine, watching updates about them on E! Entertainment, etc.) , while Roger seeks to dissipate his loneliness by spending time with his dog Fluff (buying his dog presents, taking his dog for long walks, and talking to his dog each night about his day) . What does research suggest about the effectiveness of these techniques?

• A) Both Anabelle and Roger should have some success in staving off loneliness.
• B) Anabelle will likely have some success in staving off loneliness, but Roger will not.
• C) Roger will likely have some success in staving off loneliness, but Anabelle will not.
• D) Neither Anabelle nor Roger is likely to have success in staving off loneliness.

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Definitions:

Net Cash Flows

The difference between a company's cash inflows and outflows over a specific period.

Outlay

The total amount of money spent on a particular purchase or project.

IRR

Internal Rate of Return; a metric used in financial analysis to estimate the profitability of potential investments.

Cost of Capital

The rate of return that a company must pay on its investment and financing activities to maintain its current market value.