Which of the following is the best example of a transactions cost?
A) The price of a new set of tyres.
B) The price of labour and materials used to produce a house.
C) The value of the time spent negotiating a contract.
D) The cost associated with producing a golf club.
E) The price of food.

Question

Quizplus · Accepted Answer

Transactions costs refer to the costs incurred in completing a transaction, including the time and effort spent on negotiating and finalizing the terms of the transaction. Therefore, the value of time spent negotiating a contract is the best example of a transactions cost.

Which of the Following Is the Best Example of a Transactions