What are transaction costs? What are some ways in which society reduces transaction costs?
What will be an ideal response?
Transaction costs are costs associated with exchanging goods and services. They include information costs associated with finding out price, quality, and other characteristics of the good and the other party in the exchange, and costs of contracting and enforcing the contract. Organized markets, retail stores and shopping malls, advertising, and middlemen are several institutions that have developed to reduce transaction costs.
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A decrease in unplanned inventory investment for the entire economy equals the excess of
A) output over aggregate supply. B) output over aggregate demand. C) aggregate supply over output. D) aggregate demand over output.
If we have a stock selling for $95.00 and a call option for this stock has a strike price of $82.00 and an option price of $13.60:
A. the intrinsic value is $0 since the option is out of the money. B. the intrinsic value of the option is $13.00 and the time value of the option is $0.60. C. the intrinsic value is $82.00 and the time value of the option is $13.60. D. the intrinsic value of the option is $0.60 and the time value of the option is $13.00.
Use the above table. We can infer from the table that when real disposable income is $175
A) APC = 0.80. B) APC = 0.09. C) APC = 0.91. D) APC = 0.20.
If, as a consumer, Jeannine is very sensitive to changes in the price of pineapples,
A) her demand is price elastic. B) her demand is price inelastic. C) her supply is price elastic. D) her supply is price inelastic.