Mae Was Asked to Solve the Following Problem: Pretend That

question 112

Multiple Choice

Mae was asked to solve the following problem: Pretend that you are a bus driver.You begin the day with an empty bus.At your first stop, you let on 10 passengers.At your second stop, 4 people get off the bus, and 12 people get on.At your third stop, 8 people get off the bus, and 2 people get on.At your fourth stop, nobody gets off the bus, and 1 person gets on.How old is the bus driver? According to Sternberg and Davidson, if Mae just adds the numbers without focusing on the relevant part of this problem, he or she is showing a lack of

• A)selective attention.
• B)selective encoding.
• C)selective comparison.
• D)selective combination.

---

Definitions:

Time Value

The portion of an option's premium that is attributable to the amount of time remaining until the expiration of the option.

Call Option

An economic agreement granting the purchaser the choice, but not the duty, to acquire a stock, bond, commodity, or any asset at a previously determined price within a set period.

Call Option

A financial agreement that allows the purchaser the option, without the requirement, to purchase a stock, bond, commodity, or different asset at an agreed-upon price during a predetermined timeframe.

Expiration

The predetermined date on which an options or futures contract becomes void and the right to exercise it ceases.