Respuesta :
When real interest rates are high, so is the opportunity cost of funds. This statement is true because
- The opportunity cost of funds in the interest rate
- the higher interest rates make it more costly to use or borrow funds
- the real interest rate is important when considering the cost of funds
The correct option is D.
What is opportunity cost?
According to microeconomic theory, an activity's opportunity cost is the value or gain that is forfeited in exchange for engaging in that activity as opposed to engaging in an alternative activity. In plainer terms, it indicates that if you choose one activity, you forfeit the chance to choose an other one.
Why is opportunity cost important?
We may select the greatest option out of all the options accessible with the aid of the idea of opportunity cost. It assists us in making the most skillful and effective use of all available resources to maximize economic gains.
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I understand that the question you are looking for is:
When real interest rates are high, so is the opportunity cost of funds. This statement is true because
A. The opportunity cost of funds in the interest rate
B. the higher interest rates make it more costly to use or borrow funds
C. the real interest rate is important when considering the cost of funds
D . All of the above
