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Wages paid to a labour who was engaged in production activities can be termed as.a.imputed cost.b.direct cost.c.indirect cost.d.sunk cost.

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Solution

The wages paid to a laborer who is engaged in production activities can be termed as a direct cost.

Here's why:

A. Imputed Cost: This is a cost that is not actually incurred but is given a value in monetary terms for decision-making purposes. It's not applicable here because the laborer's wages are a real, tangible expense.

B. Direct Cost: This is a cost that can be directly attributed to the production of a specific good or service. The laborer's wages fall into this category because they are a direct part of the production process.

C. Indirect Cost: This is a cost that cannot be directly linked to the production of a specific good or service. Examples might include utilities or administrative salaries. The laborer's wages are not an indirect cost because they are directly tied to production.

D. Sunk Cost: This is a cost that has already been incurred and cannot be recovered. The laborer's wages are not a sunk cost because they are an ongoing, not a one-time, expense.

So, the correct answer is b. Direct Cost.

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