Arbitraging Price Differences Between Two Markets Is Generally Not Possible

question 49

Multiple Choice

Arbitraging price differences between two markets is generally not possible if:

• A) there are positive costs of transporting the products from one market to the other.
• B) the transportation costs are larger than the difference in prices.
• C) the government has prohibited exchange between the two markets.
• D) A and C above
• E) B and C above

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Definitions:

Consumer Culture

A society focused on the buying and selling of goods and services, where consumer preferences drive business practices and social trends.

American Way

A phrase that refers to the lifestyle, traditions, and values commonly associated with life in the United States.

Hoovervilles

Makeshift shantytowns built by homeless people during the Great Depression in the United States, named after President Herbert Hoover.