Identify some of the possible transactions costs involved in an exchange of a used car between two individuals
Transaction costs include the costs incurred by the seller and the buyer of the used car to locate each other. The transportation costs involved in meeting each other as well as the time involved in bargaining for a price is also a part of the transaction cost of this deal. If they do not speak the same language the services of an interpreter will add to the transaction cost.
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Taxes are costly to market participants because they
a. transfer resources from market participants to the government. b. alter incentives. c. distort market outcomes. d. All of the above are correct.
Unanticipated inflation tends to penalize:
A. people who save money in financial institutions. B. businesses that borrow money from financial institutions. C. individuals who borrow money from financial institutions. D. governments that have a progressive personal income tax.