Harvey develops gaming apps from home instead of working as an engineer and earning $50,000 a year.He has invested $20,000 to upgrade to the hardware that he needs and estimates his expenses at $17,000 a year.Downloads generated $130,000 in revenue during the first year.What are his explicit costs?
A)$37,000
B)$50,000
C)$43,000
D)$93,000
E)$130,000

Question

Quizplus · Accepted Answer

Explicit costs are the direct, out-of-pocket expenses for a business. In this case, Harvey's explicit costs include the $20,000 for hardware upgrades and $17,000 in annual expenses, totaling $37,000.

Harvey Develops Gaming Apps from Home Instead of Working as an Engineer