The implicit rental rate for capital includes the
A) total value of a piece of capital equipment.
B) interest income forgone by purchasing the piece of capital equipment.
C) firm's normal profit.
D) amount paid for the use of a piece of capital equipment owned by someone else.

Question

Quizplus · Accepted Answer

The implicit rental rate for capital includes the opportunity cost of using the capital, which is the interest income forgone by purchasing the piece of capital equipment instead of investing the money elsewhere.

The Implicit Rental Rate for Capital Includes the