Question

Identify Implicit Cost & Explicit Cost in the following case. "A person starts a Taxi Service. The taxi is financed by a bank. He himself drives the taxi. He also pays Annual License Fees to Government."​

Answer 1

Answer:

Explanation:

implied cost, or notional cost, is 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. it will be explicit cost because he pays annual license fees to government