The Opportunity Cost to a Firm of Using an Asset

question 8

Multiple Choice

The opportunity cost to a firm of using an asset is zero if

• A) no money was spent to acquire the asset.
• B) the asset has no alternative uses.
• C) the asset was given to the firm for free.
• D) the asset has zero sunk costs associated with it.
• E) the asset is already owned by the firm.

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Definitions:

Total Taxes

refer to the comprehensive amount of taxes (federal, state, local) levied on individuals, corporations, and other entities within a fiscal period.

Taxable Income

The portion of income subject to taxation after all deductions and exemptions have been applied according to tax laws.

Entry Fees

Charges that must be paid to gain access to a particular service, event, or location.

National Parks

Protected areas established by national governments aimed at conserving natural beauty, biodiversity, and cultural heritage while providing recreational opportunities.