Question

Calculate the monthly implicit costs for a business owner who devotes 200 hours per month to his business that could be spent working at $50/hour for someone else.

Answer 1

Implicit cost = $10,000

Step-by-step explanation:

Implicit cost is the opportunity cost of using resources a business already owns.

This business owner passes this income by being in a business for himself

200 hours per month multiplied by $50/hour

200 x 50

= 10000

Implicit cost = $10,000