An Example of an Implicit Cost of Production Is:​

question 45

Multiple Choice

An example of an implicit cost of production is:​

• A)the cost of raw materials used to produce bread in a bakery.
• B)the cost of labor in a factory that assembles DVD players.
• C)the income an entrepreneur could have earned working for someone else.
• D)the salary of a manager working in a multinational agency.
• E)the hourly wage of a chef hired by a popular food chain.

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Definitions:

Hyperinflation

An extremely high and typically accelerating inflation rate, causing a rapid erosion of currency's value.

Deflation

A decrease in the general price level of goods and services, often characterized by the increase in the value of money.

Disinflation

Disinflation is the process of slowing down the rate of inflation, indicating a reduction in the speed at which the general level of prices for goods and services is rising.

Wage-Price Spiral

A macroeconomic concept describing a situation where rising wages lead to increased prices, which in turn lead to demands for higher wages, thus perpetuating inflation.