The opportunity cost of capital owned by the firm should reflect
A)acquisition cost.
B)the return foregone by using the capital rather than renting it to another firm.
C)wage rate differences.
D)both a and b

Question

Quizplus · Accepted Answer

The opportunity cost of capital owned by the firm reflects the return foregone by using the capital rather than renting it to another firm, as it represents the best alternative use of that capital.

The Opportunity Cost of Capital Owned by the Firm Should