If Zero Rates (Also Known as Discount Rates) Are Positive $d ( t )$

question 15

Multiple Choice

If zero rates (also known as discount rates) are positive for any maturity, the discount function $d ( t )$ , which gives the present value of a dollar receivable at time $t$ in the future,

• A) Must be between 0 and 1
• B) Must be greater than 0 and can be greater than 1
• C) Can be a negative number
• D) is usually 0.99

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Definitions:

Richard Lazarus

A psychologist known for his work on stress, coping, and emotion, especially his theory on cognitive appraisal of stress.

Stress Hormones

Hormones, such as cortisol and adrenaline, that are released into the body in response to stress, affecting various bodily functions and preparing an individual to face stressors.

Epinephrine

This entity, known as adrenaline, serves simultaneously as a hormone and a neurotransmitter, activating the body's defense mechanism known as fight-or-flight.

Norepinephrine

A neurotransmitter and hormone important in the body's fight or flight response, affecting heart rate, blood flow, and blood pressure among other functions.