A company's expenditure on raw materials is regarded as?
ECONOMICSJAMB 2020
A company's expenditure on raw materials is regarded as?
- A. explicit cost
- B. implicit cost
- C. prime cost
- D. average cost
Correct Answer: A. explicit cost
Explanation
Explicit costs are direct payments incurred by a firm in the course of running a business. These are costs actual and physical costs incurred by a firm. Examples of explicit costs include wages, lease payments, utilities, raw materials, and other direct costs.
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