If All Interest Rates Decline 90 Basis Points $\Delta$ R/(1 + R)= -90 Basis Points),what Is the Change in R/(1

question 88

Multiple Choice

If all interest rates decline 90 basis points ( $\Delta$ R/(1 + R) = -90 basis points) ,what is the change in the market value of equity?

• A)-$4.4300 million
• B)+$3.9255 million
• C)+$4.3875 million
• D)+$2.5506 million

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Definitions:

Purposive

Having or serving a purpose; intentional or goal-oriented in nature.

Supernormal Stimulus

An exaggerated artificial stimulus that elicits a stronger response than the natural stimulus for which an organism is programmed.

Early Instinct Theories

Theories proposing that behaviors are primarily driven by innate instincts, focusing on the innate, biological determinants of behavior.

Genetic Programs

The predetermined sequences of development and behavior encoded in an organism's DNA.