A Region Is Considering Two Sites on Which to Locate

question 18

Multiple Choice

A region is considering two sites on which to locate a new wastewater treatment plant. Site A has been owned by the region for five years and the region initially paid $200,000 for the land.The current market value of the site is $400,000.Site B is land the region would have to purchase for $300,000.What is the social opportunity cost of each site?

• A)$200,000 for Site A; $300,000 for Site B
• B)$300,000 for Site A; $300,000 for Site B
• C)$400,000 for Site A; $300,000 for Site B
• D)The social opportunity cost should be state for the project, not each site and would be equal to the lowest value for either site, $200,000

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Definitions:

Personal Property

Items of property that are not attached to real estate, such as vehicles, furniture, and electronics.

Debt

An amount of money borrowed by one party from another, typically with the condition that it is to be repaid with interest.

Security Agreement

A legal document that provides a lender a security interest in a specified asset or property that serves as collateral for a loan.

Documents

Written, printed, or electronic records that provide evidence or information.