Consider a Firm Making a Decision to Purchase a Unit

question 29

Multiple Choice

Consider a firm making a decision to purchase a unit of capital - let's say,a forklift.In terms of capital markets,which of the following would we consider to be the opportunity cost of the forklift ?

• A)the additional revenue to the firm that the forklift would generate in the future
• B)the resale value of the forklift after one year
• C)the future stream of MRPs from the forklift
• D)the interest the firm could earn by purchasing a bond instead
• E)the purchase price of the forklift

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Definitions:

Inference Forms

Patterns of reasoning that determine the validity of an argument by analyzing its structure.

HS

A logical argument pattern of hypothetical syllogism, involving two conditional statements leading to a conclusion.

MP

Stands for "Member of Parliament," but in a logical context, it refers to a deductive pattern of reasoning where a specific conclusion is inferred from a general rule and a specific case.

Conj

An abbreviation for "Conjunction," a logical operator that connects two conditions or propositions where both must be true.