What Is a Heuristic

question 13

Multiple Choice

What is a heuristic?

• A)a complicated and systematic method of decision making
• B)a purely intuitive method of decision making
• C)a totally unreliable method of decision making
• D)a shortcut or rule of thumb that is used for decision making

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Definitions:

Net Present Value

A calculation that determines the value of a series of future cash flows in today's dollars, used to assess the profitability or viability of an investment or project.

Retained Earnings

The portion of a company's profits not distributed as dividends to shareholders, but instead reinvested in the business.

Risk-Free Rate

The theoretical return on an investment with no risk of financial loss, often represented by the yield on government securities.

Financing

The act of providing funds for business activities, making purchases, or investing.