Susan Is Staying with Some Friends Who Have a Dog

question 531

Multiple Choice

Susan is staying with some friends who have a dog. Each night, when she has turned off the TV and is heading for bed, she gives the dog a treat. Soon the dog gets very excited whenever Susan turns off the TV at night because he has learned what this signal means. When Susan eventually leaves her friends' house, the dog continues to get excited when the owners turn off the TV, but since the owners don't give the dog a treat at this time, the dog's behaviour soon returns to normal. The change in the dog's behaviour after Susan's departure best illustrates the concept of

• A)habituation
• B)response cost
• C)extinction
• D)punishment

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Definitions:

Systematic Risk

The risk inherent to the entire market or market segment, which cannot be mitigated through portfolio diversification.

Beta

A measure of a stock's volatility in relation to the overall market, indicating its relative risk.

Market

A place or platform where buyers and sellers come together to trade goods, services, or financial instruments.

Expected Return

The anticipated return on an investment, based on historical data or analytical predictions, often considered in investment decision-making processes.