Golf Handicaps Are Used to Allow Players of Differing Abilities

question 70

Multiple Choice

Golf handicaps are used to allow players of differing abilities to play against one another in a fair match. Recently a sample of golfers was selected in an effort to develop a model for explaining the difference in handicaps. One independent variable of interest is the number of rounds played per year. Another is whether or not the player is using an "original" name brand club or a copy. In recent years, a number of smaller golf club manufacturers have attempted to copy major golf club designs and sell "copies" of original clubs such as the Big Bertha by Calloway. To incorporate the type of club used, which of the following methods could be used?

• A) Create a dummy variable called "Club Used" and code it "O" for original and "C" for copy.
• B) Create a dummy variable called "Club Used" and code it 1 for copy and 0 for original.
• C) Create a dummy variable called Club Used" and code it 1 for original and 0 for copy.
• D) Either B or C would work.

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Definitions:

Short-run Equilibrium

A state in which market supply and demand balance each other, and as a result, prices become stable, often in a temporal context.

Marginal Cost

The cost of producing one additional unit of a product, which can vary as production scales up or down.

Economic Losses

Financial deficits incurred by an individual, organization, or economy stemming from events or actions that reduce wealth or resources.

Constant-cost Industry

An industry in which the input prices do not change as the industry output changes, leading to a supply curve that is perfectly elastic.