Answer:

Introduction:
Entrepreneurship plays a vital role in the growth and development of the economy. An entrepreneur combines various factors of production to produce goods and services. The factors of production include land, labor, capital, and entrepreneurship. The entrepreneur is responsible for taking various decisions related to production, marketing, finance, and human resource management. One of the important decisions that an entrepreneur has to take is related to the cost of production. In this context, the concept of economic cost is of great significance.

Direct cost:
Direct cost refers to the expenses that are directly related to the production of goods and services. It includes the cost of raw materials, labor wages, rent, and other expenses. Direct cost is also known as prime cost. It is the cost that can be attributed to a particular product or service.

Accounting cost:
Accounting cost refers to the cost that is recorded in the books of accounts of the firm. It includes the cost of direct materials, direct labor, and direct expenses. Accounting cost is used for the purpose of financial reporting and taxation.

Economic cost:
Economic cost refers to the cost of using resources in the best alternative use. It includes the explicit cost and implicit cost. Explicit cost is the cash payment made by the entrepreneur to the supplier of various factors of production. It includes the cost of raw materials, wages, rent, interest, and other expenses. Implicit cost is the opportunity cost of using resources in the best alternative use. It includes the cost of foregone opportunities.

Conclusion:
In conclusion, the explicit cash payment made by an entrepreneur to the supplier of various factors of production is known as the economic cost. The economic cost includes the explicit cost and implicit cost. The explicit cost is the cash payment made by the entrepreneur to the supplier of various factors of production. The implicit cost is the opportunity cost of using resources in the best alternative use. An entrepreneur should consider both the explicit cost and implicit cost while making the production decisions.

Explicit cost is the direct payment made to the outsiders like wages, salaries etc . so it is a direct cost