Suppose that a firm can invest $100 today in a project and receive $105 a year from today. There is no inflation, and the annual interest rate in the economy is 6%. The firm should
A) invest in the project because the opportunity cost is greater than the return on the investment.
B) not invest in the project because the opportunity cost is greater than the return on the investment.
C) invest in the project because the opportunity cost is less than the return on the investment.
D) invest in the project because the opportunity cost is the same as the return on the investment.
B
Economics
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All of the following are understandable economic reasons for reductions in consumer spending on durable goods except
A) economic uncertainty. B) increases in personal income taxes. C) declines in wealth levels. D) falling interest rates.
Economics
How are scarcity, choice, and opportunity cost related?
What will be an ideal response?
Economics