Suppose That Rosa Is Considering Migration to Another Country

question 253

Multiple Choice

Suppose that Rosa is considering migration to another country. To move, she will have to spend $2,000 on transportation and $5,000 in application and other processing fees. Rosa's stream of future earnings in her home country is $300,000. She expects to earn a stream of future earnings of $700,000 in another country. Based on this information, Rosa's implicit cost of migrating is

• A)$7,000.
• B)$300,000.
• C)$307,000.
• D)$400,000.

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Definitions:

Derivative Action

A lawsuit in which certain shareholders are given the right to launch a civil action against the directors on behalf of an injured corporation; also called a representative action.

Fraudulent Acts

Intentional deception made for personal gain or to damage another individual.

Negligent

Failing to take proper care in doing something, leading to damage or injury to another.

Pre-emptive Rights

Legal rights granted to existing shareholders to purchase additional shares in a corporation before new shares are offered to the public, to maintain their proportional ownership.