Which of the Following Predictions Can Be Described by a Binary

question 125

Multiple Choice

Which of the following predictions can be described by a binary choice model?

• A) Predict the day's temperature in degrees Fahrenheit.
• B) Predict whether a student will pass or fail a test.
• C) Predict today's price of gasoline per gallon in dollars.
• D) Predict the rainfall in millimeters today.

---

Definitions:

Depreciates

Depreciates refers to the reduction in the value of an asset over time due to wear and tear, age, or obsolescence, typically reflected in accounting as a method to allocate the cost of an asset over its useful life.

Forward Contract

A customized contract between two parties to buy or sell an asset at a specified future date at a price agreed upon today.

Forward Rate

An agreed-upon exchange rate for a currency to be exchanged on a specified future date, used in forward contracts.

Discount Rate

A interest rate used to determine the present value of future cash flows.