Economic cost is a broader concept that includes both explicit costs (such as wages, rent, and materials) and implicit costs (such as the opportunity cost of using owner resources, like time and money, that could be used elsewhere). Therefore, economic cost is equal to the value of all resources used to produce a good or service, which is represented by option D.

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Economic Cost Is

Question 73

Multiple Choice

Economic cost is:

A) Equal to explicit costs minus implicit costs.
B) The same as dollar costs.
C) Equal to the accounting cost minus implicit costs.
D) The value of all resources used to produce a good or service.

Correct Answer: