Question

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

Answer 1

Answer:

Explanation:

• The cost of the factor inputs hired by the producer to produce final output is called as Prime cost.
• The prime costs can be defined as the expenses of a firm that is directly related to labor and materials used in production.
• It can be referred as the product's cost of a manufacturer that is calculated for ensuring appropriate profit margin for any company.

Answer 2

The ‘cost of the factor inputs’ hired by the ‘producer to produce’ the final output is called an explicit cost.

Explanation:

• For the production of goods, the producer incurs a cost for the factor of inputs hired by him to produce final output is referred to as the explicit cost.

• The explicit cost takes into account the costs that a company or firm incurs to pay for the raw materials, wages, utilities, advertisements, mortgages, rents and more.  

• These are factor input s hired by the producer and it can also be called the actual cost.