Use This Figure for the Questions That Follow

question 166

Multiple Choice

Use this figure for the questions that follow.

-What is the major reason for the preference for urban life in Latin America?

• A) The indigenous peoples of Latin America left a legacy of urban life.
• B) Governments provide tax breaks for city dwellers.
• C) Under the colonial rule of Spain and Portugal, people living in cities had higher social status and greater economic opportunity.
• D) The cost of farmland is very high.
• E) The governments of Latin America prohibit living outside of cities as a way to limit urban sprawl.

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Definitions:

Weighted Average Cost

The combined cost of both variable and fixed goods, services, or sources of finance, weighted according to their proportions.

Bond Issues

The process of offering bonds to investors, which are debt securities constituting a loan to the issuer from the bondholder.

Cost of Debt

The effective rate that a company pays on its current debt, which can include bonds, loans, and other forms of debt, influencing its capital structure decisions.

Cost of Capital

The rate of return that a company must achieve in order to justify the cost of an investment, often influencing investment decisions.