Hello Can I Have A Detailed Explanation Of The Answer With Calculation Of The Fo

hello can i have a detailed explanation of the answer with calculation of the following problem

The table below shows a company’s demand for financial capital for R&D based on its expected rates of return from selling the cure. Every investment provides an additional 4% social return: that is, an investment that pays at least a 5% return to the drug company will produce at least a 9% return for society as a whole.

If the opportunity cost of financial capital for the drug company is 7%, the drug company will invest ___ in R&D if it receives only the private benefits of this investment.

 answer a) $250

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply