Which of the following is an implicit cost ?
A)Jones buys $100 worth of supplies from Smith.
B)Brown pays the bill he received in the mail.
C)Smith, who could work for someone else, works for himself.
D)Williamson pays his income taxes on April 15.

Question

Quizplus · Accepted Answer

Implicit costs are opportunity costs, which are the benefits foregone as a result of choosing one alternative over another. In this case, Smith's implicit cost is the salary he could earn by working for someone else, but chooses to forego in order to work for himself.

Which of the Following Is an Implicit Cost