Question

why are implicit costs calculated while estimating total cost of production?

Answer 1

The Costs of Production. In economic terms, the true cost of something is what one has to give up in order to get it. This includes explicit monetary costs of course, but it also includes implicit non-monetary costs such as the cost of one's time, effort, and foregone alternatives.

Answer 2

You can calculate the unit costs of production by dividing the totalamount of your fixed and variable costs by the total number of units you produced. For example, say your total fixed costs are $30,000, your variable costs are $50,000 and you produced 40,000 units.