Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Thanks in advance!

I need help figuring this out. I'm pretty sure this is correct?If Zambia is open to international trade in oranges without any restrictions, it will import 180 tons of oranges.I can't figure these two out: 1) Suppose the Zambian government wants to reduce imports to exactly 60 tons of oranges to help domestic producers. A tariff of ???? per ton will achieve this. 2) A tariff set at this level would raise ????in revenue for the Zambian government.

16:10 ← BEC 3701 - Assignments-... KWAME NKRUMAH UNIVERSITY TEACHING FOR EXCELLENCE SCHOOL OF BUSINESS STUDIES DEPARTMENT OF ECONOMICS AND FINANCE ADVANCED MICRO-ECONOMICS (BEC 3701) Assignments INSTRUCTIONS: Check instructions below: LTE 1) Let u(q1,q2) = ln q₁ + q2 be the (direct) utility function, where q₁ and q2the two goods. Denote P₁ and P2 as the prices of those two goods and let M be per period money income. Derive each of the following: a) the ordinary or Marshallian demand functions q₁ = d₂ (P₁, P₂, M) for i = 1,2 [3 Marks] b) the compensated or Hicksian demand functions q₁ = h₂ (P₁, P2, M) for i = 1,2 [3 Marks] c) the Indirect Utility Function uº = v(P₁, P2, M) [3 Marks] d) the Expenditure Function E(P1, P2, U°) [3 Marks] e) Draw a diagram of the solution. There should be two graphs, one above the other; the first containing the indifference curves and budget constraint that characterize the solution to the consumer's choice problem; the second characterizing the demand…

Answer 2

Question

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Answer 6

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

Answer 7

Chapter 7, Problem 1SQP

(a)

To determine

Identify, the managerâ€™s salary is an implicit cost or an explicit cost.

Answer 8

(a)

Expert Solution

Explanation of Solution

Manager’s salary is an explicit cost because salary is a direct cost that is involved in the process of running a business.

Answer 9

(a)

Expert Solution

Answer 10

(a)

Expert Solution

Answer 11

Expert Solution

Answer 12

Economics Concept Introduction

Explicit cost: Explicit cost refers to a direct cost incurred by the firm to others in the process of running a business such as wages, rents, materials, and so on. Thus, fixed cost and variable cost are included in the explicit cost.

Answer 13

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

Answer 14

(b)

To determine

Identify, payment to Dell for computers is an implicit cost or an explicit cost.

Answer 15

(b)

Expert Solution

Explanation of Solution

Payment to Dell for computers is an explicit cost because this cost involves in spending money.

Answer 16

(b)

Expert Solution

Answer 17

(b)

Expert Solution

Answer 18

Expert Solution

Answer 19

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

Answer 20

(c)

To determine

Identify, salary forgone is an implicit cost or an explicit cost.

Answer 21

(c)

Expert Solution

Explanation of Solution

Salary forgone by the owner of a firm by operating his or her own company is an implicit cost because the person gives up his work in order to start his own business. Since the salary is given up for benefit, it is an implicit cost.

Answer 22

(c)

Expert Solution

Answer 23

(c)

Expert Solution

Answer 24

Expert Solution

Answer 25

Economics Concept Introduction

Implicit costs: Implicit cost refers to the costs that have previously been incurred but are not initially shown as a separate expenditure. It denotes an opportunity cost that arises when a firm allocates internal resources.

Answer 26

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

Answer 27

(d)

To determine

Identify, interest forgone is an implicit cost or an explicit cost.

Answer 28

(d)

Expert Solution

Explanation of Solution

Interest forgone on a loan that an owner makes to his or her own company is an implicit cost because the person would earn the interest payment if he lent the amount outside the business. Thus, he has given up his interest rate.

Answer 29

(d)

Expert Solution

Answer 30

(d)

Expert Solution

Answer 31

Expert Solution

Answer 32

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

Answer 33

(e)

To determine

Identify, medical insurance payment is an implicit cost or an explicit cost.

Answer 34

(e)

Expert Solution

Explanation of Solution

Medical insurance payment that a company makes for its employees is an explicit cost because it involves spending the money directly.

Answer 35

(e)

Expert Solution

Answer 36

(e)

Expert Solution

Answer 37

Expert Solution

Answer 38

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.

Answer 39

(f)

To determine

Identify, income forgone is an implicit cost or an explicit cost.

Answer 40

(f)

Expert Solution

Explanation of Solution

Income forgone while going to college is an implicit cost because the person has given up his income for going to college. Thus, there is a fall in the opportunity cost.