Explicit Costs

question 91

Multiple Choice

Explicit costs

• A) Include only payments to labor.
• B) Are the sum of actual monetary payments made for resources used to produce a good.
• C) Include the market value of all resources used to produce a good.
• D) Are the total value of resources used to produce a good but for which no monetary payment is made. An explicit cost is a payment made for the use of a resource.

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Definitions:

Available-for-Sale Security

Financial assets such as stock or bonds that are not classified as held-to-maturity or trading securities and can be sold in the marketplace.

Fair Value

A reasonable estimate of the price for goods, services, or assets if sold in the market under current conditions.

Unrealized Loss Account

A financial account that tracks the losses on investments or assets not yet sold, representing a decrease in value.

Stockholders' Equity

Stockholders' Equity is the residual interest in the assets of a corporation after deducting its liabilities, indicating the ownership interest of the shareholders.