What typically is used to calculate the opportunity cost of capital on a risk-free investment?

The opportunity cost of capital for a risk-free investment is typically calculated using the return on a benchmark risk-free asset, such as government treasury bonds or bills. This rate reflects the compensation investors would expect for forgoing other investment opportunities with similar risk levels. Additionally, the risk-free rate can be adjusted for inflation to determine the real opportunity cost. Ultimately, it serves as a baseline to evaluate the potential returns of other investments.