The user cost of capital is given by the following formula, where PK is the real price of capital goods, d is the depreciation rate, and r is the expected real interest rate.
a. uc = d PK/r
b. uc = PK /(r + d)
c. uc = (r + d) PK
d. uc = (r + d)/ PK
Answer: C
FIN 201
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