Which of the Following Are Implicit Costs for a Typical

question 3

Multiple Choice

Which of the following are implicit costs for a typical firm?

• A) Opportunity costs of capital owned and used by the firm
• B) The cost of labour hired by the firm
• C) The cost of utilities
• D) A business licensing fee

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Definitions:

Estimated Selling Price

The price at which it is expected that goods or assets can be sold, often used in accounting for valuations.

Exit Price

The price that would be received to sell an asset or paid to transfer a liability.

Distress Sale

A distress sale occurs when property, stocks, or other assets are sold in an urgent manner, often at a loss, because of external pressures or financial hardship.

Forced Liquidation

The rapid sale of assets by a borrower who must sell these assets because of financial distress and cannot meet an obligation with cash flow.