The Interest Rate Is 10% and Is Expected to Stay

question 27

Multiple Choice

The interest rate is 10% and is expected to stay constant at that level forever.The present discounted value of $50,000 a year forever starting today is

• A)$500,000.
• B)$550,000.
• C)$ infinity.
• D)$1 million.
• E)$45,454.45.

---

Definitions:

Behaviorism

A theory of learning based on the idea that all behaviors are acquired through conditioning.

Observable Behavior

Actions or reactions of an individual that can be seen and measured directly by others.

Inferiority Complex

A psychological condition where a person feels inadequate and deficient, often resulting in a lack of self-esteem and overcompensation in other areas.

Adler

Alfred Adler was an Austrian medical doctor and psychotherapist, founder of the school of individual psychology, known for his concepts of the inferiority complex and striving for superiority.