Question #95349

is this statement correct implicit costs are monetary payments for the factors of production and other inputs bought or hired by the firm

Expert's answer

Explicit costs are monetary payments for the factors of production and other inputs bought or hired by the firm. But implicit costs are the opportunity cost equal to what a firm must give up in order to use a factor of production for which it already owns and thus does not pay rent.

So, the statement is false.


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