Find opportunity cost when investment of rs 50,000 in the stock market,by way of withdrawal of demand deposit causes a - Economics - Introduction

Question

Find opportunity cost when investment of rs 50,000 in the stock
market,by way of withdrawal of demand deposit causes a loss of
interest income of rs 5,000 per annum Give logical reasoning

Prince Verma · Accepted Answer

Demand deposit carries a fixed rate of return on investment, and
share market is volatile and the investment in share market does
not assure any fixed rate of interest and even recovery of the
principal amount invested initially

Withdrawal from demand deposits to invest in share market will,
therefore, carry an opportunity cost of

Investment + Return on investment = 50000 + 5000 = Rs 55000

Find opportunity cost when investment of rs.50,000 in the stock market,by way of withdrawal of demand deposit causes a loss of interest income of rs.5,000 per annum.Give logical reasoning.