Final answer:
The theory of emotion that proposes physical arousal and cognitive appraisal occur simultaneously is the Schachter-Singer two-factor theory.
Step-by-step explanation:
The theory of emotion that proposes that physical arousal and cognitive appraisal of a stimulus happen simultaneously is known as the Schachter-Singer two-factor theory.
This theory suggests that emotions are composed of two factors: physiological arousal and cognitive appraisal. The physiological arousal is interpreted in context to produce the emotional experience. For example, when faced with a venomous snake, the sympathetic nervous system activation is labeled as fear given the context, resulting in an experience of fear.