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    Question

    In farm economics, costs that are not directly paid out

    of pocket but represent the value of owned resources used in production are referred to as:
    A Social cost Correct Answer Incorrect Answer
    B Private cost Correct Answer Incorrect Answer
    C Variable cost Correct Answer Incorrect Answer
    D Fixed cost Correct Answer Incorrect Answer
    E Implicit cost Correct Answer Incorrect Answer

    Solution

    Private costs include both explicit and implicit costs. Implicit costs like family labor or owned capital, though not paid in cash, still represent opportunity costs borne by the farm owner.

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