Which of the following is an implicit cost to the Johnston Manufacturing Company?
A)payments of wages to its office workers
B)property taxes
C)rent paid for the use of equipment owned by the Schultz Machinery Company
D)returns that the shareholders could have received if they had not bought shares in the Johnson Manufacturing Company
E)payments made for its purchases of electrical power

Question

Quizplus · Accepted Answer

Implicit costs are those that represent foregone opportunities, such as the returns shareholders could have earned on their investment elsewhere, rather than direct out-of-pocket expenses.

Which of the Following Is an Implicit Cost to the Johnston