Scenario 21-2 Lawrence Has Recently Graduated from College with a Degree in Degree

question 132

Multiple Choice

Scenario 21-2
Lawrence has recently graduated from college with a degree in journalism and economics. He has decided to pursue a career as a freelance journalist writing for business newspapers and magazines. Lawrence is typically awake for 112 hours each week (he sleeps an average of 8 hours each day) . For each hour Lawrence spends writing, he can earn $75. Lawrence is such a good writer that he can get paid for as many hours of writing as he chooses to work.
-Refer to Scenario 21-2. If Lawrence's wage increases to $90 per hour of writing, which of the following points would fall on his budget constraint?

• A)75 hours of leisure, $2,775 of consumption
• B)80 hours of leisure, $2,400 of consumption
• C)85 hours of leisure, $2,430 of consumption
• D)90 hours of leisure, $1,650 of consumption

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Definitions:

Dividend Yield

This ratio in finance shows the comparison between a company's annual dividend payout and its stock price.

Dividend Income

Earnings received from owning shares of a company that pays dividends.

Shares

Shares represent portions of equity in a company or an investment, entitling holders to a proportional share of any distributed profits, known as dividends, when they are announced.

Capital Gain

The profit from the sale of a capital asset, such as stocks or real estate, where the sale price exceeds the purchase price.