Which of the following would be considered an implicit cost?
A) Health insurance of employees paid for by the firm
B) The water bill of the firm
C) The salaries paid to the managers of the firm
D) Foregone rent on assets owned by the firm

Question

Quizplus · Accepted Answer

Foregone rent on assets owned by the firm is considered an implicit cost because it represents the opportunity cost of using those assets for other purposes, such as renting them out for income. Health insurance, water bills, and salaries are all examples of explicit costs that involve direct payments from the firm.

Which of the Following Would Be Considered an Implicit Cost