A Convenience Store Owner Is Contemplating Putting a Large Neon

question 2

Multiple Choice

A convenience store owner is contemplating putting a large neon sign over his store. It would cost $50,000, but is expected to bring an additional $24,000 of profit to the store every year for five years. Would this project be worthwhile if evaluated using a payback period of two years or less and if the cost of capital is 10%?

• A) Yes, since it will pay back its initial investment in two years.
• B) Yes, since the value of the cash flows into the store, in present dollars, are greater than the initial investment.
• C) Yes, since the cash flows after two years are greater than the initial investment.
• D) No, since the value of the cash flows over the first two years are less than the initial investment.

Appreciate the evolutionary aspects of social cognition and behavior.

Understand the concept of fundamental attribution error and how it influences perception of others' behaviors.

Comprehend the neurological responses to attractiveness and eye contact based on fMRI studies.

Recognize the adaptiveness of relying on social categories for cognitive efficiency and survival.

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Definitions:

Consecutive Trials

Successive attempts or tests carried out to achieve a particular result, where each trial follows the previous one without interruption.

Possible Outcomes

Refers to all the potential results that could occur from a specified event or experiment.

Binomial Random Variable

A random variable that has only two possible outcomes, typically described as success and failure, in a series of experiments.

Fixed Period

A set length of time during which certain activities or events are scheduled to occur or conditions are meant to remain unchanged.