John invested $12.000 in the stock of Hyper Cyber. Eight years later, Hyper Cyber's shares reached $125,000, but John held onto the shares in the belief that their price would double in the next five years. Unfortunately, Hyper Cyber did not double. Rather the market value of John's shares today is S4,000. If the shares were sold and the proceeds invested in another investment, they would likely eam 5% per annum. Which of the following terms and values is correct? . A S2000 is the opportunity cost • B. $125,000 is the opportunity cost of selling the shares today • C S250,000 is the opportunity cost • D. $12,000 is a sunk cost
John invested $12.000 in the stock of Hyper Cyber. Eight years later, Hyper Cyber's shares reached $125,000, but John held onto the shares in the belief that their price would double in the next five years. Unfortunately, Hyper Cyber did not double. Rather the market value of John's shares today is S4,000. If the shares were sold and the proceeds invested in another investment, they would likely eam 5% per annum. Which of the following terms and values is correct? . A S2000 is the opportunity cost • B. $125,000 is the opportunity cost of selling the shares today • C S250,000 is the opportunity cost • D. $12,000 is a sunk cost
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 80IIP
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