Suppose That Albert Can Buy a Bond for $1,000 That

question 114

Multiple Choice

Suppose that Albert can buy a bond for $1,000 that matures in two years and pays Albert $1,102.5 with certainty.He is indifferent between this bond and one that has some risk but on which the interest rate is 3% higher.How much,to the nearest penny,does the riskier bond pay in two years?

• A)$1,160.00
• B)$1,166.40
• C)$1,168.65
• D)$1,169.64

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Definitions:

Delusions

false beliefs firmly held despite clear or contradictory evidence, often seen in psychiatric conditions.

Delusions

Fixed false beliefs that are resistant to reason or confrontation with actual fact, often observed in psychiatric conditions.

Unfounded Beliefs

Ideas or opinions adopted without sound evidence or rational justification.

Schizophrenia

A chronic mental disorder characterized by distorted thoughts, perceptions, emotions, speech, and behavior.