Which of the following statements about markets is true?
a. Markets reduce the opportunity costs of making exchanges.
b. Markets expand the range of buyers and sellers available as counterparties.
c. Markets increase the transaction costs of making exchanges.
d. Markets increase the costs of information.
B
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People who are risk averse
A) value a collection of assets only on the basis of its expected returns. B) value a collection of assets only on the basis of the risk of that return. C) value a collection of assets not only on the basis of its expected returns but also on the basis of the risk of that return. D) are less likely to invest in life insurance. E) are less likely to have a diverse portfolio.
For which of the following products would price discrimination be easiest?
a. orange juice b. diamonds c. compact disks d. haircuts e. gasoline
Merit goods are
a. goods that everyone wants b. goods that are rewards for appropriate behavior c. the same as public goods d. goods that some people think we need more of e. only produced by the government
The De Beers Diamond company is not worried about differentiating its product from all other gemstones
a. True b. False Indicate whether the statement is true or false