What Annual Rate of Return Is Implied on a $5,000

question 25

Multiple Choice

What annual rate of return is implied on a $5,000 loan taken next year when $7,700 must be repaid in year 8?

• A) 6.36%
• B) 7.12%
• C) 8.54%
• D) 11.62%

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Definitions:

Cognitive Model

A theoretical approach that explains psychological phenomena by emphasizing mental processes, including perception, memory, and thought.

Counterconditioning

A behavior therapy technique used to replace an undesirable response to a stimulus with a more desirable one.

Shaping

A method in behavioral psychology used to gradually train a new behavior by reinforcing successive approximations to the desired behavior.

Premack Principle

A principle in psychology that states that more probable behaviors will reinforce less probable behaviors.