Question

On Naomi's pig farm, Naomi hires all the labor used, grows all the grain fed to the pigs, and owns the barn. The costs used to calculate the total cost curve include

a. only the cost of labor.

b. the cost of labor, the cost of growing grain, and the opportunity cost of the barn.

c. only the cost of labor and the cost of grain, which is completely consumed in the period in which it is grown.

d. only the variable cost of growing grain.

Answer 1

Answer

option b

the cost of labor, the cost of growing grain, and the opportunity cost of the barn

the cost in economics is explicit plus implicit cost so the cost of labor and grain is explicit cost and barn is the implicit cost