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Accounting costs and economic costs differ because A) Economic costs include explicit costs and accounting costs do not. B) Accounting costs include explicit costs and economic costs do not. C) Economic costs include implicit costs and accounting costs do not. D) Accounting costs include implicit costs and economic costs do not.

Respuesta :

hyderali230

Answer:

C) Economic costs include implicit costs and accounting costs do not.

Explanation:

Economic cost can be calculated as follow

Economic Cost = Explicit cost + Implicit cost

Whereas, the Implicit cost is calculated as follow

Accounting cost = Explicit cost

Hence, the difference between the economic cost and accounting cost is only the implicit cost.

Implicit cost is the opportunity cost.

Nyctalus

Answer:

Option C

Explanation:

In simple words, implicit cost refers to the opportunity cost or we can say the cost of losing profit by choosing the best alternative over the second best one. The economic cost includes this opportunity cost while accounting cost only includes the outside or explicit cost to a subject.

Thus, from the above we can conclude that the correct option is C.

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