If the transaction between you and the seller takes place at a price that equals your valuation of the product, then:
a. you realize all the gains from this transaction.
b. the gains from this transaction are equally divided between the two of you.
c. the entire economic value created by the transaction goes to the seller.
d. the economic value created by this transaction is sub-optimal.
C
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Suppose the Fed is targeting real GDP. If the interest rate is below its forecast and the Fed is convinced that this is due to commodity demand instability, it will ________ the money supply, which turns out to be exactly the wrong thing to do if the
low interest rate is in fact due to ________ money demand. A) raise, high B) raise, low C) lower, high D) lower, low
The nominal exchange rate:
A. expresses the value of goods in one country in terms of the same goods in another country. B. is the stated rate at which one country's currency can be traded for another country's goods and services. C. is the stated rate at which one country's currency can be traded for another country's currency. D. expresses the value of goods in one country in terms of another country's currency.
Which of the following resulted from the Smoot-Hawley trade bill of 1930?
A) The stock market began a steady recovery from the crash of October 1929. B) Many countries responded by imposing higher tariffs on American products, and the volume of international trade fell sharply. C) Imports decreased, while exports increased, resulting in an overall increase in GDP and tariff revenues. D) The unemployment rate, which had been rising, began to steadily decline as jobs were protected by the trade restrictions.
The quantity of domestically produced goods and services that households, firms, the government, and customers abroad want to buy at each price level is shown on the
a) aggregate-goods curve. b) market-demand curve. c) aggregate-demand curve. d) aggregate-supply curve.