|(i) In the given example, the farmer carries on farming with the help of family members. If these members had worked elsewhere they would have earned wages.|
|Therefore, the imputed expenditure incurred on the wages of family members is implicit cost.|
|(ii) The farmer takes the farm on rent. Therefore, the expenditure incurred on rent (input) is explicit cost.|
You need to login to perform this action.
You will be redirected in 3 sec