Which of the following statements is FALSE? (more then 1 may be correct) The opp

Question

Which of the following statements is FALSE? (more then 1 may be correct)

The opportunity cost of capital is the return the investor forgoes when the investor takes on a new investment

Interest rates we observe in the market will vary based on quoting conventions, the term of investment, and risk

For a risk-free project, the opportunity cost of capital will typically be greater than the interest rate of U.S. Treasury securities with a similar term

The investors opportunity cost of capital is the best available expected return offered in the market on an investment of comparable risk and term of the cash flows being discounted

Explanation / Answer

Answer is : For a risk-free project, the opportunity cost of capital will typically be greater than the interest rate of U.S. Treasury securities with a similar term

Explanation: For a risk free project, opportunity cost of capital will be equal to U.S. treasury bill rate.

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