Behavioral Economics _____

question 30

Multiple Choice

Behavioral economics _____

• A)borrows insights from psychology to help explain economic choices.
• B)maps brain activity while subjects make economic choices.
• C)views people as robot-like maximizers.
• D)assumes that people act rationally.
• E)assumes that people pursue their rational self-interest.

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Definitions:

Per Share FCFE

Free Cash Flow to Equity (FCFE) calculated on a per-share basis, indicating the amount of cash available to shareholders per share.

Required Return

The minimum expected return by investors for investing in a risky asset, considering the risk level compared to the risk-free rate.

Per Share FCFE

Free Cash Flow to Equity per share, which indicates how much cash is available to the equity shareholders of a company after all expenses and reinvestments.

Required Return

The minimum expected return an investor demands for investing in a particular asset, considering its risk.