Explicit vs. Implicit Costs in Business

Answered using GPT-4o mini by AI Answer Generator

Question:

Explicit costs incurred by firms include the firm's opportunity costs.

False

True

Answer:

False

Explicit costs are the direct, out-of-pocket expenses that a firm incurs in the course of its business operations, such as wages, rent, and materials. Opportunity costs, on the other hand, represent the potential benefits that are foregone when choosing one alternative over another and are considered implicit costs, not explicit