The Economic Cost to the Owners of a Firm for Using

question 22

Multiple Choice

The economic cost to the owners of a firm for using productive resources

• A)is measured fully by the explicit or out-of-pocket expenses incurred when the firm uses resources it purchases in the market.
• B)does not include implicit costs associated with resources the firm already owns.
• C)is the total opportunity cost of all resources used by the firm.
• D)is measured by the sum of the explicit costs of market supplied resources plus the implicit costs of owner-supplied resources.
• E)both c and d

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Definitions:

Commodity 1

A generic term for a raw material or primary agricultural product that can be bought and sold, such as copper or coffee.

Commodity 2

Typically refers to a basic good used in commerce that is interchangeable with other goods of the same type.

Budget Line

A graphical representation of all possible combinations of two goods that a consumer can afford given their income and the prices of the goods.

Budget Line

A graphical representation of all possible combinations of two goods that can be purchased with a given income and prices.