Melody Decides to Spend Three Hours Working Overtime Rather Than

question 106

Multiple Choice

Melody decides to spend three hours working overtime rather than going to the park with her friends.She earns $20 per hour for overtime work.Her opportunity cost of working is

• A)the $60 she earns working.
• B)the $60 minus the enjoyment she would have received from going to the park.
• C)the enjoyment she would have received had she gone to the park.
• D)nothing,since she would have received less than $60 worth of enjoyment from going to the park.

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Definitions:

Regression Analysis

A statistical method used to examine the relationship between one dependent variable and one or more independent variables.

Slope

In mathematics and economics, the slope represents the rate at which a variable changes in relation to another variable, often depicted as the rise over run on a graph.

Beta

An indicator of the fluctuation or inherent risk of a security or portfolio compared to the overall market.

Firm-specific Risk

The portion of an investment's risk that is attributable to the unique circumstances of the specific company, as opposed to market-wide risk.