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Earn +20 ptsQ: What is opportunity cost rate?
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Opportunity cost of holding money?
The opportunity cost of holding money is the nominal interest rate.
Is the opportunity cost rate a single number used in all situations?
No, the opportunity cost does not rate a single number that is used in all situations.
What is opportunity cost and opportunity benefit?
Opportunity cost is the cost that an opportunity presents. The opportunity benefit is the benefit of the opportunity that is being presented.
Is an investment an implicit cost?
Yes, investment is an implicit cost because it is a firm investing their own money in something that (by definition of an opportunity cost) could have been invested in something else. Investment is the opportunity cost of a firm using their own money, and whether or not the opportunity that the firm invested in is worthwhile is defined by the NROR (the normal rate of return).
What is the opportunity cost to a fully employed economy of increasing capital investment?
A fall in consumption
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