Interest is considered a(n) A) explicit cost when the firm pays a bank to borrow money. B) implicit cost when the firm owner uses his or her own funds to buy capital. C) return to entrepreneurship if the firm owner uses her own funds to buy capital. D) form of depreciation if the cost of borrowing increases. Both answers explicit cost when the firm pays a bank to borrow money and E) implicit cost when the firm owner uses his or her own funds to buy capital are true.
Interest is considered a(n) A) explicit cost when the firm pays a bank to borrow money. B) implicit cost when the firm owner uses his or her own funds to buy capital. C) return to entrepreneurship if the firm owner uses her own funds to buy capital. D) form of depreciation if the cost of borrowing increases. Both answers explicit cost when the firm pays a bank to borrow money and E) implicit cost when the firm owner uses his or her own funds to buy capital are true.
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 8SQP
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