Suppose You Have an Option That Gives You a Lifetime

question 27

Multiple Choice

Suppose you have an option that gives you a lifetime income of $75,000 or a graduated income that begins at $30,000 and ends at $120,000 with the exact same present value. Which of the following would be true?

• A)Based on purely rational choice assumptions you should prefer the first choice.
• B)The first choice is preferred because no one likes low income years.
• C)The second choice is generally preferred because the steadily improving income brings some pleasure.
• D)There is no reason to believe either choice is preferred so you would be indifferent between the two options.

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Definitions:

Reaction Type

A category defining the nature of chemical reactions based on the rearrangement of atoms and changes in their bonding.

Reaction Type

Refers to the classification of chemical reactions based on their outcome or the change they involve, such as synthesis, decomposition, single replacement, or double replacement reactions.

Iron

A chemical element with symbol Fe and atomic number 26, known for its high strength and magnetic properties.

Limiting Reactant

The reactant in a chemical reaction that limits the amount of product that can be formed because it is used up first.