In General, Economists Feel That the External Benefit Of

question 2

Multiple Choice

In general, economists feel that the external benefit of:

• A) crime reduction that occurs as a result of a college education is quite large.
• B) research is generated primarily from advanced degrees.
• C) artistic events, such as plays, is nonexistent.
• D) research undertaken by colleges outweighs the external benefit of crime reduction.

Differentiate between total risk and systematic risk.

Grasp the principles behind the Capital Asset Pricing Model (CAPM).

Define and calculate portfolio beta and its significance in diversification.

Identify diversifiable (unsystematic) and non-diversifiable (systematic) risks.

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Definitions:

Fixed Overhead Budget Variance

The difference between the budgeted fixed overhead costs and the actual fixed overhead incurred during a period.

Fixed Manufacturing Overhead

The total of all manufacturing costs that do not change with the level of production, including salaries of permanent employees and rent.

Fixed Overhead Volume Variance

The difference between the budgeted fixed overhead and the applied amount, revealing how well a company utilized its fixed resources.

Fixed Overhead Budget Variance

The difference between the budgeted and actual fixed overhead costs incurred during a specified period.