You Decide to Move to the Mountains of Colorado and Want

question 84

Multiple Choice

You decide to move to the mountains of Colorado and want to know what would be a good offering price on a home, but you know you will only own it a year. Fortunately, you are armed with the simple residential investment equation. You have the following information: the real interest rate is 4 percent; the depreciation rate of homes is 5 percent; average rent is $1,000; there is no expected capital gain; and you will have a 20 percent down payment. You offer the owner, rounding to the nearest dollar:

• A) $25,000.
• B) $125,000.
• C) $4,167.
• D) $17,241.
• E) $50,000.

Recognize the social exchange theory and its application to relationships.

Explain the concept of self-expansion in relationships.

Differentiate between various theories explaining attraction and romantic engagement.

Understand the role of arousal in the misattribution of attraction.

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Definitions:

"50 Percent" Rule

A principle in insurance, especially in regards to total loss claims, stipulating that if the cost of repairing an item exceeds 50% of its value, it is considered a total loss.

Assumption Of Risk

Voluntarily taking on a known risk. A defense against negligence that can be used when the plaintiff had knowledge of and appreciated a danger and voluntarily exposed himself or herself to the danger.

Duty Of Care

A legal obligation that requires individuals to exercise a reasonable level of caution and protection to avoid harm to others.

Reasonable Person

A hypothetical individual in law whose behavior serves as a standard to determine what a prudent person would or would not do under similar circumstances.