Implicit and Explicit Costs Are Different in That

question 203

Multiple Choice

Implicit and explicit costs are different in that

• A)explicit costs are opportunity costs; implicit costs are not.
• B)implicit costs are opportunity costs; explicit costs are not.
• C)the latter refer to nonexpenditure costs and the former to monetary payments.
• D)the former refer to nonexpenditure costs and the latter to monetary payments.

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Definitions:

Asset Surrendered

A situation or transaction where an asset is given up by its owner, which could be due to sale, exchange, forfeiture, or similar circumstances.

Undepreciated Cost

Undepreciated cost refers to the original cost of an asset minus any depreciation that has been claimed to date, reflecting its current book value.

Business Automobile

A vehicle owned and used by a company for business operations or activities.

Market Value

The current price at which an asset or service can be bought or sold, determined by supply and demand dynamics in open markets.