Three Conditions Are Necessary for Gray Markets to Develop

question 72

Essay

Three conditions are necessary for gray markets to develop. The conditions include:
(a) Availability of products in other markets, (b) limited trade barriers, and (c)
_______________________.

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Definitions:

Socially Efficient

A situation in which resources are allocated in the most beneficial way from the perspective of society as a whole, considering both private and external costs and benefits.

Individual Resident

A person who inhabits a particular place, typically referring to living in a specific geographic area or dwelling.

Hire

The action of providing employment to someone; the act of engaging an individual for a job.

Marginal Cost

The additional cost resulting from the production of one more unit of a product or service.