Suppose the best investment you could make with $100,000 in cash is to purchase a government bond that pays 14 percent interest per year
If you decide to invest the money in your own business instead of buying the government bond, the opportunity cost of this financial capital is A) $1,400 per year.
B) $100,000 per year.
C) $14,000 per year.
D) zero, because you already had the $100,000.
C
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Table 3-2 Combination Cotton Corn A 12 16 B 17 15 C 21 13 D 23 9 E 24 5 ? The concept of opportunity cost can be represented graphically by the
A. area inside the production possibilities frontier. B. slope of the production possibilities frontier. C. vertical distance from the horizontal axis to the production possibilities frontier. D. horizontal distance from the vertical axis to the production possibilities frontier. E. sum of the horizontal and vertical distances to the production possibilities frontier.
All of the following will shift the demand curve for capital, except:
a. future expectations about the demand for the good produced by a firm. b. technological changes. c. the price of capital. d. the entry of new firms into the market. e. the change in the interest rate.
Inflation is an overall:
A. rise in prices in the economy. B. decline in prices in the economy. C. rise in prices in the economy, excluding those with historically volatile price changes. D. decline in prices in the economy, excluding those with historically volatile price changes.
If intended investment is $1 billion and unwanted inventory is $0, then we know that
a. all of the following statements are true b. saving = $0 c. consumption = $1 billion d. the economy will grow e. actual investment = $1 billion