Question

Which statement best summarizes the relationship between investments and

Answer 1

Answer:

The correct answer is C. Companies use investments to reduce the opportunity cost of low productivity.

Explanation:

The opportunity cost is the economic value that is given to the lost opportunity by economic agents when making a specific financial decision. Thus, for example, a company that decides to manufacture a car has as an opportunity cost the benefits lost by not producing a motorcycle.

In this sense, many companies tend to invest their profits obtained as a result of their productivity, in order to cover the opportunity cost and obtain greater profits.