If You Were Offered the Chance of an Investment in a Mango

question 50

Multiple Choice

If you were offered the chance of an investment in a mango orchard in North Queensland and you were promised a return of $12 000 per year for ever,with the first payment being in one year from now,what is the maximum amount you would be prepared to pay for such an investment if you required a return of 14 per cent?

• A)$87 514
• B)$58 714
• C)$85 714
• D)$120 000
• E)It cannot be calculated.

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Definitions:

Problem-solving Ability

The capacity to find solutions for difficult or complex issues, often involving analytical or creative thinking.

Retrieval Ability

The capacity to recall or retrieve information from memory when needed.

Primary Mental Abilities Test

A test designed to measure different types of mental abilities, such as verbal comprehension, reasoning, and numerical ability.

Louis Thurstone

Was an American psychologist who contributed significantly to psychometrics and is known for his development of the Thurstone scale for attitude measurement.