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Jolana is asked to invest $5000 in a friend's business with the promise that the friend will repay $5800 in one year. Jolana finds her
Jolana is asked to invest $5000 in a friend's business with the promise that the friend will repay $5800 in one year. Jolana finds her best alternative to this investment, with similar risk, is one that will pay her $5500 in one year for an investment of $5000 today. U.S. Treasury securities of similar term offer a rate of return of 2%. What is the opportunity cost of capital in this case? O 2% 12% O 8% O 10% O 16%
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