You and a Friend Are Sitting in the Dorm Watching

question 168

Multiple Choice

You and a friend are sitting in the dorm watching a televised trial.A witness currently on the stand repeats several times that he saw the defendant leaving the murder scene and that he is sure.Your friend comments,"Well,that about does it.If he says the defendant did it and is confident about it,then that's it!" What do you say?

• A) "Eyewitness testimony is very reliable."
• B) "Accuracy of an eyewitness is usually very high."
• C) "Confidence of an eyewitness is strongly related to accuracy of the testimony."
• D) "Don't be so quick. There is a weak relationship between confidence of the eyewitness and the accuracy of the testimony."

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Definitions:

Face Value

The nominal value printed on a financial instrument like a bond or stock certificate, indicating its legal worth at issuance.

Implicit Interest

The interest rate that is not explicitly stated but inferred from the difference between the purchase price and the total payments to be made in a financing transaction.

Zero-Coupon Bond

A type of bond that does not pay periodic interest and is sold at a discount from its face value, with the full face value being paid at maturity.

Implicit Interest

The interest represented by the difference between the cash price of a product and the amount financed over time, not directly stated as an interest rate.