One difference between implicit costs and explicit costs is that:
A) implicit costs are included in profits that accountants compute, whereas explicit costs are not.
B) implicit costs are included in economic profits, whereas explicit costs are not.
C) explicit costs are included in profits that accountants compute, whereas implicit costs are not.
D) explicit costs are included in economic profits, whereas implicit costs are not.
E) explicit costs involve opportunity costs, whereas implicit costs involve a monetary transaction.

Question

Quizplus · Accepted Answer

Explicit costs are direct, out-of-pocket payments that accountants include in financial statements, while implicit costs are opportunity costs not recorded in accounting profits.

One Difference Between Implicit Costs and Explicit Costs Is That