After graduation, you face a choice. One option is to work for a multinational consulting firm and earn a starting salary (benefits included) of $\backslash (40,000$. The other option is to use$\backslash )5,000$in savings to start your own consulting firm. You could earn an interest return of 5 percent on your savings. You choose to start your own consulting firm. At the end of the first year, you add up all of your expenses and revenues. Your total includes $\backslash (12,000$in rent, $\backslash )1,000$in office supplies, $\backslash (20,000$for office staff, and $\backslash )4,000$in telecommunications expenses. What are your total explicit costs and total implicit costs?

Labor and salary, rent, and materials are examples of explicit expenditures that a company pays out of pocket. The expenses of using resources that the company already owns and uses in its operations, such as moving a plant onto land it already owns, are known as implicit costs.

The total figure is stated, which includes rent, office supplies, office personnel, and telecommunications costs.

Total explicit and hidden costs must be determined.

The necessary payment is the firm's total explicit cost, whereas the implicit cost is an opportunity cost. As a result, the company must pay for rent, office supplies, office personnel, and phone expenses.

$\mathrm{\$}37,000(12,000+1,000+20,000+4,000=37,000)$is the total cost quoted. The firm's expenses and revenues do not include any hidden costs.