Transaction costs:
A)are information costs, but information costs are not all transaction costs.
B)are always variable costs, but may not be sunk costs.
C)are production costs.
D)are always sunk costs.

Question

Quizplus · Accepted Answer

Transaction costs are costs associated with the process of exchanging goods and services, which include not only the actual costs of completing the transaction (such as transportation and communication costs) but also the costs of acquiring and processing information necessary for the exchange. However, not all transaction costs are information costs; they may also include negotiation costs, search costs, and enforcement costs. Transaction costs may be variable or fixed, and they may or may not be sunk costs.

Transaction Costs