Which of the Following Statements Is NOT True About Exchanges

question 114

Multiple Choice

Which of the following statements is NOT true about exchanges in the market system?

• A) In voluntary exchange both parties are better off because of the exchange.
• B) Exchanges occur only in situations of barter where the market price is irrelevant.
• C) Prices indicate what is relatively abundant and what is relatively scarce.
• D) Transaction costs in exchanges include the cost of enforcing a contract as well as the costs of information.

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Definitions:

Past Discomfort

Refers to physical or emotional distress experienced in the past as a result of specific events or circumstances.

Diminution

Diminution refers to the reduction in the size, value, or importance of something. In legal and financial contexts, it often involves the loss of property value or asset worth.

Private Nuisance

A legal term for when an individual's use of their property interferes with another person's enjoyment or use of their own property.

Use and Enjoyment

This term refers to the legal right to utilize and derive benefits from property as long as it doesn't infringe on the law or rights of others.