Asked by Crissy Hogue on Jun 13, 2024
Verified
An example of an explicit cost for the owner of a tattoo parlor would be the wages that she could earn if she worked as a graphic artist for an advertising agency.
Explicit Cost
The direct, out-of-pocket payment made by businesses for the use of resources.
Graphic Artist
A professional who creates visual content to communicate messages through digital and printed mediums.
- Identify the critical nature of incorporating both direct and indirect costs in the study of business economics.
- Examine the significance of explicit and implicit costs within various professional environments to understand their effect on overall expenses and profitability.
Verified Answer
GM
gulsoom muhammadiJun 18, 2024
Final Answer :
False
Explanation :
The wages that she could earn if she worked as a graphic artist for an advertising agency represent an opportunity cost, not an explicit cost. Explicit costs are direct payments made to others in the course of running a business, such as rent, utilities, and employee wages.
Learning Objectives
- Identify the critical nature of incorporating both direct and indirect costs in the study of business economics.
- Examine the significance of explicit and implicit costs within various professional environments to understand their effect on overall expenses and profitability.
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