How are explicit costs calculated
A)They require an outlay of money by the firm.
B)They include all of the firm's opportunity costs.
C)They include income that is forgone by the firm's owners.
D)They include interest earned from abandoned investment opportunities.

Question

Quizplus · Accepted Answer

Explicit costs are the actual out-of-pocket expenses incurred by a firm, such as wages paid to employees, rent or lease payments on office space, and purchase of raw materials. These costs can be easily calculated by tracking the actual cash outflows from the business.

How Are Explicit Costs Calculated