Exercise I: Explicit and implicit costs (20 points total/5 points each)

Determine and explain whether each of the following is an explicit or implicit cost: Remember to explain in one or two sentences the reason for your answer.

The wage income that an owner could earn if he did not work for himself.

The payment of rent for a warehouse that is rented by the company.

The possible income received for the rental to another company of a building owned by the company that uses it as a warehouse for its own production.

Payments made for hired labor in the labor market.