Suppose You Win a Small Lottery and You Are Given

question 31

Multiple Choice

Suppose you win a small lottery and you are given the following choice: You can receive (1) an immediate payment of $10,000 or (2) two annual payments,each in the amount of $5,200,with the first payment coming one year from now,and the second payment coming two years from now.You would choose to take the immediate payment of $10,000 if the interest rate is

• A)2 percent,but not if the interest rate is 1 percent.
• B)3 percent,but not if the interest rate is 2 percent.
• C)4 percent,but not if the interest rate is 3 percent.
• D)5 percent,but not if the interest rate is 4 percent.

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Definitions:

Laughing

A physical response to stimuli that is considered humorous or relieving, often resulting in vocal sounds and slight body movements.

Touching

The act of coming into physical contact with something or someone, often conveying emotion or facilitating interpersonal connection.

Unconditioned Response

A natural, automatic reaction to a stimulus that occurs without any learning or prior conditioning.

Laughing

A physiological response that expresses joy or amusement, often a spontaneous reaction to humor or happiness.