Explicit costs are actual expenditures that a firm must make, such as wages, rent, and materials. This is different from implicit costs, which represent the opportunity costs of all resources used by the firm, including the owner's time and forgone alternative uses of the firm's resources.

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Explicit Costs Are

Question 109

Multiple Choice

Explicit costs are

A) the opportunity costs of all resources used by the firm.
B) the costs associated with the resources that the firm owns.
C) actual expenditures that a firm must make.
D) all costs associated with the short run.

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