Misty Has the Option of Purchasing One of Three Products

question 210

Multiple Choice

Misty has the option of purchasing one of three products: Brand A, Brand B, or Brand C. Each costs ten dollars. If she decides that Brand A meets her needs best, then the opportunity cost of this decision is

• A) Brand B plus Brand C.
• B) twenty dollars.
• C) Brand A.
• D) Brand B or Brand C, depending on which is considered the highest-value alternative forgone.

---

Definitions:

Yield To Maturity

The expected overall profit from a bond when it is kept until the date of its maturity.

Current Yield

The annual income (interest or dividends) earned from an investment, expressed as a percentage of the current price.

Annual Coupon

The fixed interest rate paid by a bond annually to its holder.

Yield To Maturity

The total return anticipated on a bond if it is held until the maturity date, considering both interest payments and capital gains or losses.