Transactions Costs Refer to

question 106

Multiple Choice

Transactions costs refer to

• A)the implicit costs of production.
• B)the costs in time and other resources that parties incur in the process of agreeing to and carrying out an exchange of goods or services.
• C)the raw material cost of production.
• D)the cost of transporting goods from one destination to another.

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Definitions:

Deadweight Loss

The loss of economic efficiency when the equilibrium for a good or a service is not achieved or is not achievable.

Rent Control

A government policy or law that sets a maximum price landlords can charge for rent.

Opportunity Costs

The cost of the next best alternative foregone when making a decision.

Wasted Time

Time that is not used effectively or productively.