Darryl Runs a Ranch in Jackson,Wyoming

question 7

Multiple Choice

Darryl runs a ranch in Jackson,Wyoming.The interest on the debt he incurred to buy his ranch totals $3,000 per year.For Darryl,the interest is

• A) an implicit cost.
• B) an explicit cost.
• C) his normal cost.
• D) his normal profit.
• E) part of his economic profit.

---

Definitions:

Bonds Payable

Long-term liabilities representing money owed by a company to bondholders, to be repaid by a specified date.

Issue Price

Issue price is the cost at which new securities are offered to the public by an issuer, determining the initial capital raised from the financial market.

Par Value

The nominal or face value of a security as indicated by the issuer.

Liabilities

Financial obligations or debts owed by a business to another entity, payable in the future.