Scenario 14-4 Victor Is the Recipient of $1 Million from a Lawsuit

question 137

Multiple Choice

Scenario 14-4
Victor is the recipient of $1 million from a lawsuit. Victor decides to use the money to purchase a small business in Florida. His business operates in a perfectly competitive industry. If Victor would have invested the $1 million in a risk-free bond fund, he could have earned $100,000 each year. After he bought the small business, Victor quit his job as a market analyst with Research, Inc., where he used to earn $75,000 per year.
-Refer to Scenario 14-4. What is Victor's opportunity costs of operating his new business?

• A)$25,000
• B)$75,000
• C)$100,000
• D)$175,000

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Definitions:

Hysteria

A psychological condition that manifests as exaggerated or uncontrollable emotion or excitement, often without an identifiable cause.

Amnesia

is a disorder characterized by the loss of memories, such as facts, information, and experiences, which can be temporary or permanent, and partial or complete.

Paralysis

The loss or impairment of voluntary muscular power, potentially caused by injury or disease affecting the nervous system.

Between-Family Differences

Variabilities in characteristics, such as socioeconomic status, parenting styles, or resources, that exist among different families.