You borrow $20,000 at an interest rate of 6% to open Candy Dan's, a gourmet sweet shop. You will earn an economic profit if the return on your investment is

Question

Quizplus · Accepted Answer

To earn an economic profit, the return on the investment needs to be greater than the interest rate of 6%. Therefore, choice C is the best option as it states that the return on the investment needs to be greater than 6%. Choices A and B are incorrect as they either include returns that are equal to or less than the interest rate. Choice D is not necessary as the question does not state a specific rate of return needed for the investment to be successful.

You Borrow $20,000 at an Interest Rate of 6% to Open