If the Present Value of an Investment's Benefits Equals the Present

question 5

Multiple Choice

If the present value of an investment's benefits equals the present value of the investment's costs, then the investor would earn a

• A) return equal to the discount rate.
• B) negative rate of return.
• C) 0% rate of return.
• D) return greater than the discount rate.

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Definitions:

Social Loafing

The phenomenon of a person exerting less effort to achieve a goal when they work in a group than when they work alone.

Social Facilitation

The tendency for individuals to perform differently when in the presence of others than when alone, usually showing improvement in tasks they find easy or have well-rehearsed.

Normative Social Influence

The impact of others that causes us to change our behavior to gain their approval and acceptance.

Informational Social Influence

The process of changing one’s behavior to align with the group's, based on the belief that the group possesses accurate information.