Transactions costs are:
A)the costs of establishing and maintaining property rights.
B)the costs of exploiting economic resources for production.
C)very expensive.
D)caused when people impose externalities on others.

Question

Quizplus · Accepted Answer

Transactions costs refer to the costs incurred when individuals and firms engage in economic transactions, such as searching for information, negotiating and enforcing contracts, and establishing and maintaining property rights. Therefore, choice A best describes transactions costs.

Transactions Costs Are