alleryStart learning →Costs that involve no actual payment but still represent something given up are:
ATotal costs
BImplicit costs
CExplicit costs
DVariable costs
Answer & Solution
Correct answer: B. Implicit costs
1. Not everything a firm sacrifices shows up on an invoice.
2. Explicit costs are out-of-pocket costs, that is, actual payments.
3. Implicit costs are more subtle, but just as important.
4. An owner's forgone salary is the standard example of an implicit cost.
_Source: OpenStax Principles of Microeconomics for AP(R) Courses 2e (CC BY 4.0), Ch 7 'Production, Costs and Industry Structure', sections 7.1-7.4_
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