Explicit costs are:
A)not part of opportunity costs.
B)the only costs considered in opportunity costs.
C)exactly the same as implicit costs.
D)actual monetary payments for resources purchased.
E)the opportunity costs of using resources owned by the firm.

Question

Explicit costs are:​
A)not part of opportunity costs.
B)the only costs considered in opportunity costs.
C)exactly the same as implicit costs.
D)actual monetary payments for resources purchased.
E)the opportunity costs of using resources owned by the firm.

Quizplus · Accepted Answer

Explicit costs are actual monetary payments for resources purchased, such as wages, rental payments, and supplies. Implicit costs, on the other hand, are the opportunity costs of using resources owned by the firm, such as the foregone earnings from using owned equipment for another purpose or the foregone salary the owner could have earned by working elsewhere. Therefore, explicit costs are not part of opportunity costs, but they do represent a subset of the costs that are considered in calculating the firm's total costs.

Explicit Costs Are:​

Explicit Costs Are: