Your Subscription to Investing Wisely Weekly Is About to Expire

question 15

Multiple Choice

Your subscription to Investing Wisely Weekly is about to expire.You plan to subscribe to the magazine for the rest of your life,and you can renew it by paying $75 annually,beginning immediately,or you can get a lifetime subscription for $750,also payable immediately.Assuming you can earn 5.5% on your funds and the annual renewal rate will remain constant,how many years must you live to make the lifetime subscription the better buy? Round fractional years up.(Hint: Be sure to remember that you are solving for how many years you must live,not for how many payments must be made.)

• A)10
• B)11
• C)12
• D)13

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Definitions:

Heuristics

Simple, efficient rules or methods used to make judgments and decisions based on limited information, often leading to satisfactory but not always optimal solutions.

Behavioral Economics

A field of study merging insights from psychology and economics to explore how people make decisions and how these decisions can deviate from those predicted by standard economic theories.

Behavioral Economics

An area within economics that examines the impact of psychological, cognitive, emotional, cultural, and social influences on the economic choices made by individuals and organizations.

Advertising Campaigns

Coordinated series of promotional efforts that aim to achieve specific objectives, such as increasing brand awareness or sales, over a set time period.