Economic costs are synonymous with
A) Accounting costs
B) Sunk costs
C) Opportunity costs
D) Implicit costs

Question

Quizplus · Accepted Answer

Economic costs refer to the opportunity cost of the resources that have been used in a particular project or decision. Therefore, economic costs are synonymous with opportunity costs. Accounting costs only consider the explicit costs (out-of-pocket expenses) associated with a decision, while sunk costs are costs that have already been incurred and cannot be recovered. Implicit costs are the opportunity costs of the resources owned by an individual or a firm, such as the time of the owner/s involved in the decision-making process.

Economic Costs Are Synonymous with