Suppose You Win a Small Lottery and You Are Given

question 65

Multiple Choice

Suppose you win a small lottery and you are given the following choice: You can receive (1) an immediate payment of $5,000 or (2) two annual payments, each in the amount of $2,700, with the first payment coming one year from now, and the second payment coming two years from now. You would choose to take the two annual payments if the interest rate is

• A)2 percent, but not if the interest rate is 3 percent.
• B)3 percent, but not if the interest rate is 4 percent.
• C)4 percent, but not if the interest rate is 5 percent.
• D)5 percent, but not if the interest rate is 6 percent.

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Definitions:

Barbiturates

Drugs that depress central nervous system activity, reducing anxiety but impairing memory and judgment.

Opiates

Opium and its derivatives, such as morphine and heroin; depress neural activity, temporarily lessening pain and anxiety.

Substance Use Disorder

A medical condition characterized by the compulsive use of substances despite harmful consequences, leading to significant impairment or distress.

Psychoactive Drugs

Substances that alter brain function, resulting in temporary changes in perception, mood, consciousness, and behavior.