2) (10 Points) Assume that you have $1,000,000 and practicing the following investing opportunity in portfolio of stocks
Posted: Sun Jul 03, 2022 6:50 am
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2) (10 Points) Assume that you have $1,000,000 and practicing the following investing opportunity in portfolio of stocks and bonds that earns 12% yearly. Further assume that you consider owning a small industrial firm by investing $1,000,000 that earns a yearly profit of $200,000. o Calculate explicit, implicit, and opportunity costs as well as business, accounting, and economic profits of owning this small industrial firm. o Do you think that this is an economically feasible investment? Why?
Answer the above 2) (10 Points) Assume that you have $1,000,000 and practicing the following investing opportunity in portfolio of stocks and bonds that earns 12% yearly. Further assume that you consider owning a small industrial firm by investing $1,000,000 that earns a yearly profit of $200,000. o Calculate explicit, implicit, and opportunity costs as well as business, accounting, and economic profits of owning this small industrial firm. o Do you think that this is an economically feasible investment? Why?