Your company owns land in a busy shopping district. If the chair of the company's board of directors thinks they can build a plant on that land and that the land will incur no additional cost, the chair fails to take into account:
A) capital expenditures
B) opportunity costs
C) sunk costs
D) depreciation

Question

Quizplus · Accepted Answer

The chair is not considering the opportunity costs that could arise from using the land for a plant, such as potentially higher profits from leasing the land to another company or developing it for a more lucrative purpose.

Your Company Owns Land in a Busy Shopping District