High Transaction Costs Will Tend to

question 28

Multiple Choice

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.

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Definitions:

Resulting Events

Outcomes or occurrences that follow from specific actions or conditions.

Associative Learning

The process of learning in which a connection between two stimuli or between a stimulus and a response is learned.

Continuous Reinforcement

A learning process in which a behavior is reinforced every time it occurs, leading to faster acquisition of the behavior.

Respondent Behavior

A type of reaction to stimuli that is automatic or reflexive, such as salivating when smelling food.