Interest is considered a(n) A) explicit cost when the firm pays a bank to borrow money. B) implicit cost when the firm owner uses his or her own funds to buy capital. C) return to entrepreneurship if the firm owner uses her own funds to buy capital. D) form of depreciation if the cost of borrowing increases. Both answers explicit cost when the firm pays a bank to borrow money and E) implicit cost when the firm owner uses his or her own funds to buy capital are true.
Interest is considered a(n) A) explicit cost when the firm pays a bank to borrow money. B) implicit cost when the firm owner uses his or her own funds to buy capital. C) return to entrepreneurship if the firm owner uses her own funds to buy capital. D) form of depreciation if the cost of borrowing increases. Both answers explicit cost when the firm pays a bank to borrow money and E) implicit cost when the firm owner uses his or her own funds to buy capital are true.
Chapter31: Capital Markets
Section: Chapter Questions
Problem 5E
Related questions
Question
100%
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Macroeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506756
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Macroeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506756
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning