Based on the house you selected for purchase in Question 2, determine the opportunity costs , of using required funds for closing ( i.e., down payment plus all closing costs ), rather than investing the funds and earning an effective rate of 5.5% yearly. The down payment amount will be 20 % of the purchase price of the house you selected For estimation purposes. closing costs will be $3,000.00 . 

Calculate the amount of forgone interest on investment 2. Add the sunk closing cost amount for the following periods: 

a. Two years 

b . Three years 

c. Six years 

d. Eight years

Answer rating: 100% (QA)

Option C is correct Six years Sunk cost refers to a cost that has already occurred and has no pot... View the full answer