The main factor that explains the difference between accounting cost and economic cost is
A)opportunity cost.
B)fixed cost.
C)variable cost.
D)All of the above help to explain the difference.

Question

Quizplus · Accepted Answer

The main factor that explains the difference between accounting cost and economic cost is opportunity cost, which is the cost of the next best alternative foregone. Accounting cost only considers explicit costs, while economic cost includes both explicit and implicit costs, such as opportunity cost. Fixed and variable costs are factors that contribute to both accounting and economic costs, but they do not explain the difference between the two.

The Main Factor That Explains the Difference Between Accounting Cost