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A Farmer Invests His Own Saving in Doing Farmings but Hires Labour to Do Work. Identify Implicit Cost. - Economics

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A farmer invests his own saving in doing farmings but hires labour to do work. Identify implicit cost.

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Solution

Implicit cost is the value of self-owned inputs in their next best alternative use. Here, the farmer investing his own savings in a farming activity is the implicit cost.

Concept: Basic Concepts of Cost
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