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Money cost is also known as the nominal cost. It is nothing but the expenses incurred by a firm to produce a commodity. For instance, the cost of producing 200 chairs is Rs. 10000, and then it will be called the money cost of producing 200 chairs.
Cost is the monetary value of goods and services purchased by producers and consumers. For example, a consumer typically equates cost with the price of a good (such as a loaf of bread, a pair of shoes, or a car) or a service (such as a haircut or a night in a hotel).
Money costs are also known as nominal costs and normal costs. They refer to the money payments made by a producer for producing goods. Money costs are further divided into two types namely Explicit costs and Implicit costs.
15 cze 2019 · A list and definition of different types of economic costs - fixed, variable, total, marginal, sunk, accounting, opportunity cost. Diagrams and examples
Explicit costs are out-of-pocket costs, that is, actual payments. Wages that a firm pays its employees or rent that a firm pays for its office are explicit costs. Implicit costs are more subtle, but just as important. They represent the opportunity cost of using resources that the firm already owns.
29 sie 2024 · Opportunity cost is the potential forgone profit from a missed opportunity—the result of choosing one alternative over another.
In short, money can be anything that can serve as a • store of value, which means people can save it and use it later—smoothing their purchases over time; • unit of account, that is, provide a common base for prices; or • medium of exchange, something that people can use to buy and sell from one another.
