An Opportunity Cost Is the Potential Benefit Obtained by Using

question 197

True/False

An opportunity cost is the potential benefit obtained by using resources in an alternative course of action.

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Definitions:

Net Cash Flows

The difference between a company's cash inflows and cash outflows during a specific period.

Straight-Line Depreciation

A method of calculating the depreciation of an asset, where the expense is evenly distributed over its useful life.

Accounting Rate of Return

A metric used to measure the profitability of investments, calculated by dividing the average net income by the initial investment cost.