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Questions and Answers
In the context of market transactions, what does voluntary exchange refer to?
In the context of market transactions, what does voluntary exchange refer to?
- Buyers and sellers engaging in transactions where both parties are better off (correct)
- Buyers and sellers engaging in transactions without any benefit
- Buyers and sellers engaging in transactions to achieve maximum utility
- Buyers and sellers engaging in transactions with no consideration for alternatives
What principle involves making decisions based on increments?
What principle involves making decisions based on increments?
- Rational behavior
- Marginal analysis (correct)
- Voluntary exchange
- Opportunity cost
What does opportunity cost refer to?
What does opportunity cost refer to?
- The benefit achieved from market transactions
- The alternatives considered before making a choice
- The maximum utility derived from a decision
- The most desirable alternative given up when you make a choice (correct)
What does rational behavior involve?
What does rational behavior involve?
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