William, a journeyman carpenter with an​ associate’s degree in civil​ engineering, had been making

William, a journeyman carpenter with an​ associate's degree in civil​ engineering, had been making ​$33 comma 475 per year as a carpenter for a building contractor. As a​ self-employed subcontractor, William incurred explicit costs of ​$265 comma 000 per year. What is​ William's economic​ cost? His economic cost is ​$ nothing per year. ​ (round your answer to the nearest​ penny)

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This Post Has 3 Comments

  1. A- the queen isn’t specified which one so its to capitalized same with nuclear reactors and atomic power plant (aka they aren’t proper nouns)

  2. $265,000


    Economic cost is the addition of implicit cost and explicit cost. That is,

    Economic cost = Explicit cost + Implicit cost (1)

    Explicit costs are payments that are actually made. It is also known as out-of-pocket costs.

    Implicit cost is an implied cost because they are not actually paid. Implicit cost is a loss of income, but a loss of profit. An example is an opportunity cost.

    Since we are not given implicit cost in the question, equation (1) is estimated as follows:

    Economic cost = ​$265,000 + 0 = $265,000

    Therefore, William's economic​ cost is equal to his explicit cost of $265,000.

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