Which of the Following Can Be Classified as an Implicit

question 73

Multiple Choice

Which of the following can be classified as an implicit cost of production?

• A)The cost of raw materials
• B)Rent forgone on the office building
• C)Interest paid on debt
• D)Salary paid to workers

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Definitions:

Economic Income

The total value of all income received over a period of time, including wages, rents, profits, and transfer payments.

Taxable Income

The amount of income used to calculate how much tax an individual or a company owes to the government in a specific period.

Benefits-Received Principle

The concept that those who benefit from government services should pay taxes in proportion to the amount of benefits they receive.

Fairness

In economics, fairness often relates to the equitable distribution of resources and outcomes among diverse groups of people.