Question

The cost of factor inputs hired by the producer to produce final output is called explicit cost?

Answer 1

Answer:

Explanation:

Cost It refers to the expenditure incurred by a producer on the factor as well as non-factor inputs for a given amount of output of a commodity. ... Explicit Cost These are those actual cash payments, which firms make to ... incurred by the producer on purchase or hiring of fixed factors of production, e.g. rent of ...

Answer 2

Yes, the cost of factor inputs hired by the producer to produce the final output is called the explicit cost

Explanation:

• This is because explicit cost is defined as the cost in which the company pays for its raw materials and some other resources that are essential for building up of an industry or to deliver a product or service to the company.
• The explicit cost is highly dependent on the demand of the products which would satisfy the needs of the customers.

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