A Difference Between Explicit and Implicit Costs Is That

question 126

Multiple Choice

A difference between explicit and implicit costs is that

• A)explicit costs must be greater than implicit costs.
• B)explicit costs do not require a direct monetary outlay by the firm, whereas implicit costs do.
• C)implicit costs do not require a direct monetary outlay by the firm, whereas explicit costs do.
• D)implicit costs must be greater than explicit costs.

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Definitions:

Net Taxes

The total amount of taxes collected by the government minus any transfer payments and subsidies.

GDP

Gross Domestic Product, a measure of the economic performance of a country, evaluating the total value of all goods and services produced over a specific time period.

Government Purchases

Expenditures by government agencies on goods and services that directly satisfy public consumption or are invested in public infrastructure.

Full Employment

An economic condition where every available workforce is employed in the most effective way achievable.