Which of the following are two components of the opportunity cost of using capital already owned by the firm?
A) Economic profit and normal profit
B) Economic depreciation and forgone interest
C) Explicit rental rate and economic costs
D) Implicit rental rate and economic profit

Question

Quizplus · Accepted Answer

Opportunity cost of using capital already owned by the firm includes economic depreciation, which is the loss in value of the equipment or capital over time, and forgone interest, which is the interest income the firm misses out on by investing capital in its own operations rather than in interest-bearing assets.

Which of the Following Are Two Components of the Opportunity