Asked by Daniel Amoako on Jul 30, 2024
Verified
Economists and accountants both include forgone income as a cost to a small business owner.
Forgone Income
Income not earned due to choosing an alternative action, such as studying full-time instead of working.
- Understand the significance of considering both seen and unseen costs within the framework of business economics.
- Differentiate between economic profits and accounting profits through comprehension of the role of implicit costs.
Verified Answer
ZK
Zybrea KnightJul 31, 2024
Final Answer :
False
Explanation :
Economists consider forgone income as an opportunity cost, but accountants typically do not include forgone income in their financial calculations, focusing instead on explicit costs.
Learning Objectives
- Understand the significance of considering both seen and unseen costs within the framework of business economics.
- Differentiate between economic profits and accounting profits through comprehension of the role of implicit costs.
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