Third State Bank Wants to Add a New Branch Office

question 3

Multiple Choice

Third State Bank wants to add a new branch office.It has determined that the cost of construction of the new facility will be $1.5 million with another $500,000 in organizational costs.The bank has estimated that it will generate $319,522 per year in net revenues.If the new branch is expected to last 20 years,what is the expected rate or return on this investment? (Round to the nearest whole percent)

• A)6 percent
• B)21 percent
• C)15 percent
• D)32 percent
• E)25 percent

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Definitions:

Classical Conditioning

A training mechanism in which two stimuli are frequently paired together; over time, the response that was originally caused by the second stimulus is elicited by the first stimulus.

Unconditioned Response

A reflexive, instinctual reaction to an unconditioned stimulus, not learned through previous experience.

Conditioned Response

A learned reaction to a conditioned stimulus that occurs because of previous conditioning, an essential concept in classical conditioning theories.

Unconditioned Stimulus

A stimulus that naturally and automatically triggers a response without any prior learning.