Hutch Technology Makes Computer Monitors, Which Sell for $500 Each

question 54

Multiple Choice

Hutch Technology makes computer monitors, which sell for $500 each. What is the opportunity cost of producing ten monitors?

• A) $5,000
• B) the other goods that could be produced with the resources that produce the ten monitors
• C) the profits that Hutch earns when it sells the ten monitors
• D) the profits that Hutch loses if it does not produce the monitors
• E) All of the above are correct.

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Definitions:

Investment

The allocation of resources, usually money, in the expectation of generating an income or profit.

VaR (Value At Risk)

A statistical technique used to measure and quantify the level of financial risk within a firm, portfolio, or position over a specific time frame.

Tail Risk

The risk of an investment moving more than three standard deviations from its current price, often associated with unpredictable, extreme events.

Worst-case Scenario

The most adverse or unfavorable outcome among a set of possibilities for a situation.