Scenario 12-4
Suppose that Abdul opens a coffee shop.He receives a loan from a bank for $100,000.He withdraws $50,000 from his personal savings account.The interest rate on the loan is 8%,and the interest rate on his savings account is 2%.
-Refer to Scenario 12-4.Abdul's implicit cost of capital is
A) $8,000.
B) $4,000.
C) $2,000.
D) $1,000.
Correct Answer:
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