The explicit cost of production equals:
A)opportunity cost minus sunk cost.
B)implicit cost minus sunk cost.
C)economic cost minus opportunity cost.
D)opportunity cost minus implicit cost.

Question

Quizplus · Accepted Answer

Explicit costs are actual out-of-pocket expenses, while implicit costs are the opportunity costs of using resources. Therefore, explicit cost equals opportunity cost minus implicit cost.

The Explicit Cost of Production Equals