Total Economic Costs Include

question 58

Multiple Choice

Total economic costs include

• A) a normal rate of return.
• B) out-of-pocket costs.
• C) opportunity costs of all inputs.
• D) all of the above

---

Definitions:

Simple Rate of Return

A calculation that estimates the profitability of an investment, dividing annual incremental net operating income by the initial investment cost.

Cash Operating Costs

Expenses a business incurs through its operations that require cash payments, excluding non-cash expenses like depreciation.

Automating Process

The method of using technology to perform tasks with minimal human intervention.

Discount Rate

The interest rate fundamental to converting future cash flows into their present financial equivalent in discounted cash flow analysis.