Calculate (a) Implicit cost (b) Explicit cost and (c ) Econimic cost from the following: {:(,"Paticulars","(Rs. in Lakh)"),((i),"Payment of salaries",5000),((ii),"Expenditure of raw material",2000),((iii),"Rent of owner occupied building",1000),((iv),"Donations to charitable trust",500),((v),"Estimated value of salary of owner who worked as manager",200),((vi),"Minimum profit (expected)",400),((vii),"Super Normal profit (estimated)",700):}

Calculate (a) Implicit cost (b) Explicit cost and (c ) Econimic cost f

1.	Calculate (a) Implicit cost (b) Explicit cost and (c ) Econimic cost from the following: {:(,"Paticulars","(Rs. in Lakh)"),((i),"Payment of salaries",5000),((ii),"Expenditure of raw material",2000),((iii),"Rent of owner occupied building",1000),((iv),"Donations to charitable trust",500),((v),"Estimated value of salary of owner who worked as manager",200),((vi),"Minimum profit (expected)",400),((vii),"Super Normal profit (estimated)",700):}
Answer» Solution :(a) EXPLICIT COST: (i)+(II)=5000+2000=7000 (b) IMPLICIT cost: (III)+(v)+(vi)=1000+200+400=1600 (c ) Economic cost: (a) + (b)=7000+1600=86000