Question

The cost that is incurred to retain an input for a firm is called as

Answer 1

Answer:

Opportunity Cost.

Explanation:

The price which is necessary to retain a given input of a factor in a certain industry may be called as its transfer earning or transfer price.

Answer 2

The cost that is incurred to retain an ‘input for a firm’ is called the opportunity cost.

Explanation:

• The concept of opportunity costs is related to the theory of production. The elements of the costs involved are labour, material and other overhead costs.  

• It can also be referred to as the implicit costs that have been incurred in using any form of input or resource for the firm.  

• Opportunity cost is borne by the firm for the input or the resource that is incurred for a certain activity and it shows the true cost of production.

Learn more about opportunity cost

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