A Business Is Considering a Cash Outlay of $500,000 for the Purchase

Multiple Choice

A business is considering a cash outlay of $500,000 for the purchase of land, which it could lease for $40,000 per year.If alternative investments are available that yield a 21% return, the opportunity cost of the purchase of the land is:

A) $105,000.
B) $40,000.
C) $65,000.
D) $8,400.