An explicit cost is a direct payment made to others in the course of running a business, such as wage, rent and materials, as opposed to implicit costs, which are those where no actual payment is made. It is possible still to underestimate these costs, however: for example, pension contributions and other "perks" must be taken into account when considering the cost of labour.
Explicit costs are taken into account along with implicit ones when considering economic profit. Accounting profit only takes explicit costs into account.
Famous quotes containing the words explicit and/or cost:
“Like dreaming, reading performs the prodigious task of carrying us off to other worlds. But reading is not dreaming because books, unlike dreams, are subject to our will: they envelop us in alternative realities only because we give them explicit permission to do so. Books are the dreams we would most like to have, and, like dreams, they have the power to change consciousness, turning sadness to laughter and anxious introspection to the relaxed contemplation of some other time and place.”
—Victor Null, South African educator, psychologist. Lost in a Book: The Psychology of Reading for Pleasure, introduction, Yale University Press (1988)
“Greeting people doesn’t cost you anything except a roll of your tongue.”
—Chinese proverb.