Suppose the Best Investment You Could Make with $100,000 in Cash

question 302

Multiple Choice

Suppose the best investment you could make with $100,000 in cash is to purchase a government bond that pays 14 percent interest per year. If you decide to invest the money in your own business instead of buying the government bond, the opportunity cost of this financial capital is

• A) $1,400 per year.
• B) $100,000 per year.
• C) $14,000 per year.
• D) zero, because you already had the $100,000.

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Definitions:

B Data

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Standardized tests designed to measure human intelligence and cognitive abilities relative to a population.

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Thematic Apperception Test, a projective psychological test used to examine a person's patterns of thought, attitudes, observational capacity, and emotional responses.

Psychologist

A Psychologist is a professional specializing in the study of the mind and behavior, often working in research, education, health, and therapy to understand and support human welfare.