Which of the Following Best Describes the Interest Paid on a Bank

question 61

Multiple Choice

Which of the following best describes the interest paid on a bank loan by a local ice cream producer?

• A) It is not considered by an economist when calculating the cost of running the ice cream business.
• B) It is an implicit cost for the ice cream producer.
• C) It is an explicit cost for the ice cream producer.
• D) It is not considered by an accountant when calculating the cost of running the ice cream business.

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Definitions:

Hypercompetition

A condition in the market characterized by rapid and intense competitive moves, where advantages are quickly eroded.

Intermittent Profits

Earnings that are not consistent or regular, often fluctuating due to various external or internal factors.

Competitive Advantage

An attribute or set of attributes that allows an organization to outperform its competitors.

Sustainable Competitive Advantage

Sustainable competitive advantage exists through realising cost and quality, knowledge and speed, creating a market stronghold and protecting financial resources.