Interest Is Considered A(n)

Multiple Choice

Interest is considered a(n)

A) explicit cost when the firm pays a bank to borrow money.
B) implicit cost when the firm owner uses his or her own funds to buy capital.
C) return to entrepreneurship if the firm owner uses her own funds to buy capital.
D) form of depreciation if the cost of borrowing increases.
E) Both answers A and B are true.