Opportunity Cost = It is the cost that is to be sacrificed for achieving something else.
Given: -
Campus parking fess (class) = $4
Income earned through working for 4 hours in place of attending class = $40 ($10/hr)
Solution: -
Opportunity cost of attending class = $4 + $40 = $44.
<span>If an economy has just suffered a serious recession, we can conclude that the unemployment rate is high. After the recession when the real gdp is expanding, we can safely assume that more workers are needed to produce the gdp, which means that the unemployment rate will drop.</span>
Answer:
4.5% annual interest.
Explanation:
Assuming that we are talking about a specific Savings Account then we can say that the average APY on a savings account such as HSBC savings is 2.5% per year. On the other hand, the stock market has an average APY of 7% annually. Therefore, in order to find how much you would lose by putting your money in a savings account, we would need to subtract the savings account APY from the stock market APY.
7% - 2.5% = 4.5%
We can see that what you would lose in opportunity cost is 4.5% annual interest.
Answer:
15%
Explanation:
The maximum rate of return that would be paid to borrow an additional $4,000 needed can be calculated as
Rate of return = $600/$4000
Rate of return = 0.15 or 15%
NOTE: The amount of interest is the difference of interest earned at higher yield and interest earned at a lower yield.
Interest earned (higher yield) = $10,000 x 8%
Interest earned (higher yield) = $800
Interest earned (lower yield) = $14,000 x 10%
Interest earned (lower yield) = $1,400
Difference = $1,400-$800
Difference = $600
