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motikmotik
3 years ago
15

An investor has $50,000 in cash to put a $5,000 down payment on 10 different homes valued at $50,000 each and will finance the r

est of the investment. Soon after buying the homes she sold all 10 homes for $60,000 each and earned a profit of $100,000 - an astounding 100% return on investment. This scenario is an example of:_________
a. risk-return
b. interest rate spread
c. financial liquidity
d. leverage
Business
1 answer:
scZoUnD [109]3 years ago
3 0

Answer:

d. leverage

Explanation:

Leverage -

It is a type of investment strategy , where the borrowed money is used .

It is the method by which the firm or an organisation is expanded by using the borrowed money as the capital and funding , is referred to as leverage  .

Hence , from the given scenario of the question,

The person uses borrowed money to increase the potential return of an investment .

Hence , from the question,

The correct term is leverage .

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Suppose a gardener produces both tomatoes and squash in his garden. If he must give up 8 bushels of squash to get 5 bushels of tomatoes, then his opportunity cost of 1 bushel of tomatoes is 5/2 bushels of squash.

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Opportunity costs are invisible in nature. An opportunity cost is simply by definition is the difference between the expected returns of each option and this is also  the formula for doing so.

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Answer:

Allocated MOH= $320

Explanation:

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