Which of the following statements is true?
A)Costs are always explicit, never implicit.
B)Costs are always implicit, never explicit.
C)George runs a stationery shop; he paid Frank $5,000 for the carpet he installed in the shop.The $5,000 for carpet is an implicit cost.
D)An implicit cost is a cost that represents the value of resources used in production for which no actual monetary payment is made.
E)none of the above

Question

Quizplus · Accepted Answer

Implicit costs are indeed costs where no actual payment is made, reflecting the opportunity cost of using resources owned by the firm for which it does not make a direct payment.

Which of the Following Statements Is True