Cost Of Production and Concept of Revenue — Economics STD 11 Commerce — Question
Gujarat BoardEnglish MediumSTD 11 CommerceEconomicsCost Of Production and Concept of Revenue2 Marks
Question
What is real cost? Explain with illustration.
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Answer
According to Marshall, while making production of goods or service, the factors of production like labours, capitalist and entrepreneur have to sacrifice or suffer or forgo certain things.
They have to face mental unrest and uncertainties.
Such pain, renunciation of mental unrest can be called real cost of goods or service.
Mainly, following three matters are included in the real cost.
The labours who joined in the process of production, they feel fatigue, fed-up , bedroom or tedium etc.
The capitalist who invested his capital in the process of production for that he abandon consumption for saving.
The entrepreneur doing mental labour and worry for business and insecurity and uncertainty to resists.
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