When Two People Voluntarily Trade with Each Other

question 113

Multiple Choice

When two people voluntarily trade with each other:

• A) one person will be better off and the other person will be worse off.
• B) both of them will be better off.
• C) both of them will be worse off.
• D) whether they will be better off or worse off depends on how they negotiate with each other.

---

Definitions:

Inverse Supply

A concept in economics where the supply curve is expressed as a function of price rather than quantity supplied.

Tax

A compulsory financial charge or levy imposed by a government on individuals or entities to fund government spending and various public expenditures.

Supply Curve

A graphical representation of the relationship between the price of a good and the quantity of the good supplied.

Vertical

Referring to the direction pointing up or down, perpendicular to the horizontal plane.