Opportunity cost of purchasing inputs fro the market is called ........

Economics- Phase (I & II) Investment Function

Opportunity cost of purchasing inputs fro the market is called:

Money cost

Real cost

Explicit cost

Implicit cost

- Option 1: Money cost

- Refers to the actual monetary expenditure on inputs.

- It involves the explicit expenses incurred in transactions.

- Option 2: Real cost

- Reflects the total resources spent, including time and effort.

- It includes both explicit and implicit costs but focuses more on societal costs.

- Option 3: Explicit cost

- Represents direct, out-of-pocket payments made for inputs.

- Includes costs like wages, rent, and material expenses.

- Option 4: Implicit cost

- Refers to opportunity costs when resources are used internally rather than purchased.

- Includes foregone income from using owned resources.

Correct Answer: *Option 3: Explicit cost*

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