Which of the Following Is Generally an Opportunity Cost of Investment

question 45

Multiple Choice

Which of the following is generally an opportunity cost of investment in human capital?

• A)future job security
• B)forgone present wages
• C)increased earning potential
• D)All of the above are correct.

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Definitions:

Bond Ratings

A classification system that denotes the credit quality and perceived risk of bonds issued by corporations, municipalities, or sovereign entities.

Financial Projections

Forecasts of future revenue, expenses, and other financial details of a company.

Convertible Debt

A type of bond or loan that can be converted into a predetermined amount of the company's equity at certain times during its lifespan, usually at the discretion of the bondholder.

Zero Coupon Bond

A bond that pays no interest during its life. A “zero” sells for the present value of the principal repayment. However, the IRS imputes interest during the bond’s life on which the bondholder must pay tax.