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Tribhuvan University

BSc CSITBachelor of Science in Computer Science and Information TechnologyBCABachelor of Computer ApplicationBITBachelor of Information TechnologyBIMBachelor of Information ManagementBBABachelor of Business AdministrationBBSBachelor of Business StudiesBBMBachelor of Business ManagementBITMBachelor of Information Technology Management

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BE Computer (PU)Bachelor of Engineering in Computer EngineeringBBA (PU)Bachelor of Business Administration (Pokhara University)

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Elective microeconomics for business

microeconomics for businessTU Board 2081

Write any two examples of explicit costs.

2

Answer

· Based on the official syllabus and past papers
Updated

Explicit costs are monetary payments made by a firm to acquire resources from outside the business. Here are two clear examples:

  1. Rent Payment A business leasing office space in Thapathali, Kathmandu, must pay a monthly rent of Rs. 150,000 to the landlord. This is an explicit cost because the firm directly spends cash to use the property.

  2. Wages and Salaries If a bakery in Pokhara hires 10 employees at Rs. 25,000 per month each, the total wage bill of Rs. 250,000 is an explicit cost. The firm must pay this amount to retain its workforce.

Both examples involve direct cash outflows for resources used in production.

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