Lara Technologies Is Considering a Cash Outlay of $250,000 for the Purchase

question 78

Multiple Choice

Lara Technologies is considering a cash outlay of $250,000 for the purchase of land, which it could lease out for $35,000 per year. If alternative investments that yield a 12% return are available, the opportunity cost of the purchase of the land is

• A) $35,000
• B) $30,000
• C) $250,000
• D) $4,200

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Definitions:

Centralized Control

A management structure where decision-making authority is concentrated at the top levels of the organization.

Technical Expertise

The specialized knowledge or skills in a particular field or domain, allowing individuals to perform tasks with high levels of competence.

Divisional Geographic Structure

An organizational structure where operations are grouped based on geographical regions.

Functional Structure

An organizational design where employees are divided into departments based on their functions or specializations.