When Andrew Buys Purple Boxer Shorts at Nia's Store for $20

question 221

Multiple Choice

When Andrew buys purple boxer shorts at Nia's store for $20,

• A) Andrew's marginal benefits must be at least $20.
• B) Nia's marginal opportunity costs must greater than $20.
• C) Nia's marginal benefits from the $20 must be less than from the boxer shorts.
• D) Andrew's marginal opportunity costs must be greater than $20.
• E) this is an involuntary exchange because Andrew wouldn't be caught dead in purple boxer shorts.

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Definitions:

Individual Initiative

The drive or motivation of an individual to undertake actions on their own accord, often leading to innovation or the starting of new ventures.

Price Mechanism

The process by which the forces of demand and supply determine the prices of goods and services and allocate resources in an economy.

Capitalism

An economic system in which private individuals and businesses own capital goods and the production of goods and services is based on supply and demand in the market.

Economic System

The structured way in which a country or region organizes its economic activities and allocates resources.