Cost concepts and categorization

Cost concepts and categorization:

Money cost and Real cost

Nominal cost or money cost is the net money expenses incurred with a firm in producing a commodity.

It contains:

  1. Cost of raw materials
  2. Salaries and wages of labor
  3. Expenses on machinery and tools
  4. Depreciation on buildings, machines and such other capital goods
  5. Interest on capital
  6. Other expenses such as advertisement, taxes and insurance premium
  7. Normal gain of the entrepreneur.

Real cost is a subjective idea. It states the pains and sacrifices included in producing a commodity. The money paid for protecting the factors of productions is money cost while the efforts and sacrifice made by capitalists to invest and save, by the workers in previous leisure and by the landlords comprise real costs.

Opportunity Cost:

The opportunity cost of any good is subsequently best alternative good which is sacrificed. For illustration a farmer who is generating wheat can generate potatoes with similar factors. Thus the opportunity cost of a quintal of wheat is the quantity of output of potatoes given up.

Latest technology based Economics Online Tutoring Assistance

Tutors, at the, take pledge to provide full satisfaction and assurance in Cost and Revenue help via online tutoring. Students are getting 100% satisfaction by online tutors across the globe. Here you can get homework help for Cost and Revenue, project ideas and tutorials. We provide email based Cost and Revenue help. You can join us to ask queries 24x7 with live, experienced and qualified online tutors specialized in Cost and Revenue. Through Online Tutoring, you would be able to complete your homework or assignments at your home. Tutors at the TutorsGlobe are committed to provide the best quality online tutoring assistance for Economics Homework help and assignment help services. They use their experience, as they have solved thousands of Economics assignments, which may help you to solve your complex issues of Cost and Revenue. TutorsGlobe assure for the best quality compliance to your homework. Compromise with quality is not in our dictionary. If we feel that we are not able to provide the homework help as per the deadline or given instruction by the student, we refund the money of the student without any delay.

2015 ┬ęTutorsGlobe All rights reserved. TutorsGlobe Rated 4.8/5 based on 34139 reviews.