ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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both parties gain as a result of fraudulent exchange.
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neither party gains as specialization decreases efficiency
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neither party gains as specialization decreases productivity
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both parties gain as a result of voluntary exchange
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Detailed explanation-1: -When an individual specializes to produce one good, and then acquires additional desired goods from other specialists, both parties gain as a result of voluntary exchange.
Detailed explanation-2: -Voluntary exchange is a transaction where two people trade goods or services freely, there is no coercive or restrictive force involved in the transaction. Both parties want to make the exchange items, and both parties will benefit from the trade. Voluntary exchange is an essential concept in the free market economy.
Detailed explanation-3: -A voluntary trade is one in which both parties gain an individual benefit from making the exchange. A person who selects a TV at an electronics store and purchases it is gaining a TV that is more valuable to them than the money they spent on it.
Detailed explanation-4: -Likewise, customers voluntarily exchange money to purchase his strawberries. If they notice some of his strawberries have defects, they can decide to go elsewhere for their strawberries. Because both parties receive desirable outcomes, this is a voluntary exchange.
Detailed explanation-5: -trade. the voluntary exchange of goods and services between two or more parties (page 17)