Explicit costs are

Question

Explicit costs are

Quizplus · Accepted Answer

Explicit costs are the direct, out-of-pocket expenses incurred by a firm or individual to produce a good or service. These costs can include expenses such as wages, rent, utilities, and materials, and are always paid in cash or with a check or credit card. Implicit costs, on the other hand, are the opportunity costs of using resources that a firm already owns rather than selling them to another firm or individual. Therefore, explicit costs are not always greater than implicit costs, and they may or may not be greater, depending on the circumstances.

Explicit Costs Are