The Opportunity Cost of Capital Is Equal To

question 77

Multiple Choice

The opportunity cost of capital is equal to:

• A) the discount rate that makes the project NPV equal zero.
• B) the return that shareholders could expect by investing their money in the financial markets.
• C) a project's internal rate of return.
• D) the average rate of return for a firm's projects.

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Definitions:

Life Context

The circumstances, environment, or situations that form the backdrop for an individual's experiences and decisions.

Self-awareness

The conscious knowledge of one's own character, feelings, motives, and desires, often leading to better personal and interpersonal understanding.

Life Context

The combination of personal, social, and environmental factors that influence an individual's experiences and decision-making.

Worldview

A particular philosophy of life or conception of the world held by an individual or a group.