Asked by
luisa feregrino
on Dec 12, 2024
Verified
High transaction costs will tend to
A) reduce the number of mutually beneficial exchanges that occur.
B) allow easier specialization according to the law of comparative advantage.
C) increase the value created by exchanges in an economy.
D) increase the number of mutually beneficial exchanges that occur.
Mutually Beneficial Exchanges
Transactions that provide advantages or gains to all parties involved.
Comparative Advantage
The competence of a person, business, or nation to manufacture a product or provide a service with a lesser opportunity cost compared to rivals.
- Analyze the effects of high transaction costs on the number of exchanges and market efficiency.
Verified Answer
ME
Learning Objectives
- Analyze the effects of high transaction costs on the number of exchanges and market efficiency.