Question

_____ cost refers to actual payment made by the entrepreneur to the providers of factor services. 

Explicit

Implicit

Variable

Fixed

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Answer 1

Answer:

refers to all the payments and charges made by the entrepreneur to the suppliers of various productive factors.

Missing:

Answer 2

The actual payment made by the entrepreneur to the givers of services is known as Explicit cost.

Option(A) Explicit

• The expected business costs that appear in the general ledger and directly affect a company's profitability are known as Explicit costs.
• Any cost that has already occurred but is not necessarily shown or reported as a separate expense is known as an implicit cost.
• The corporate expense that changes in proportion to how much a company produces or sells is known as a variable cost.
• The costs that do not change when sales or production volumes increase or decrease are known as Fixed costs.
• So, Explicit cost refers to the actual payment made by the entrepreneur to providers of factor services.