Francisco D'Anconia Is Considering an Investment Opportunity That Costs $10,000

question 68

Multiple Choice

Francisco d'Anconia is considering an investment opportunity that costs $10,000 today and will pay $11,500 in two years.The IRR of this opportunity is closest to:

• A)7.25%
• B)7.50%
• C)10.00%
• D)15.00%

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Definitions:

Capacity

Refers to the maximum amount that something can contain or produce, or the ability to perform a particular task or function.

Levels-Of-Processing

A theory suggesting that the depth of mental processing affects memory; deeper levels of analysis produce more durable memory traces.

Craik And Lockhart

Psychologists who developed the Levels of Processing framework for memory, suggesting that the depth of processing (shallow to deep) affects how well information is remembered.

Frog

A cold-blooded amphibian known for its jumping abilities, croaking sounds, and life cycle that includes both aquatic and terrestrial stages.