Which of the following projects most likely has the lowest cost of capital?
A)Construction of a new steel factory
B)Investment in latest-technology, high-end television production
C)Construction of a luxury resort
D)Investment in a gold-mining operation

Question

Quizplus · Accepted Answer

Investment in a gold-mining operation is likely to have the lowest cost of capital as it involves a tangible asset (gold reserves) that serves as collateral for loans, resulting in lower borrowing costs. The other options involve investments in intangible assets that might not generate a steady stream of revenue, leading to higher borrowing costs.

Which of the Following Projects Most Likely Has the Lowest