Megan has opened a new startup company in web design. Within the first month of business, the startup agrees to maintain an accounting firm's website in exchange for someone doing their tax returns. Which of the following principles of economic interaction best describes this scenario?
a. All costs are opportunity cost.
b. Trade can make everyone better off.
c. When markets do not achieve efficiency, government intervention can improve overall welfare
d. Market allocate goods effectivity
Answer: b. Trade can make everyone better off.
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John Maynard Keynes created the aggregate expenditures model based primarily on what historical event?
A. economic expansion of the 1920s B. the Great Depression C. spectacular economic growth during World War II D. bank panic of 1907
Suppose that real GDP starts at 100 and grows at a rate of 10 percent per year for two years. In the third year real GDP would be
A) 110. B) 110.1. C) 120. D) 121.
Refer to Figure 4-13 which shows the market for watermelons. Suppose the government imposes a price floor of Pw. How will the price floor affect the quantity supplied, quantity demanded, and quantity exchanged?
What will be an ideal response?
Unpriced by-products of production or consumption that provide benefits to other consumers or other firms are known as
a. negative externalities b. common pool benefits c. positive externalities d. private benefits e. Coase by-products