Mika's Manicures leases a space in the local mall for $4,500 a month. For her business, this expense would be considered a(n):
A)implicit cost of $4,500.
B)explicit cost of $4,500.
C)explicit cost of $0.
D)fixed cost of $4,500.

Question

Quizplus · Accepted Answer

An explicit cost is a direct payment made to others in the course of running a business, such as rent. The $4,500 monthly lease payment is an explicit cost for Mika's Manicures.

Mika's Manicures Leases a Space in the Local Mall for $4,500