1. Why is it important to differentiate between explicit and implicit cost?
2. Why is it important to differentiate between the short and long run? Which business has a shorter short run, a bakery or a metal smelting business? Explain
3. Are the costs below an explicit or implicit cost? Explain your answer

• Jim, who owns a mowing company, spends the weekends servicing his lawnmowers.
• John withdrew $100,000 from his savings account to start a business.
• IBM paid interest on company issued bonds.
• Owner of the company AABB spent 2 hours going through the resumes of new job applicants.