When calculating profit economists include:
A) explicit costs.
B) implicit costs.
C) explicit and implicit costs.
D) explicit, implicit and external costs.

Question

Quizplus · Accepted Answer

Economists include both explicit and implicit costs when calculating profit to provide a comprehensive view of a firm's opportunity costs. Explicit costs are direct, out-of-pocket payments, while implicit costs represent the opportunity costs of using resources owned by the firm.

When Calculating Profit Economists Include