Which of the following can act as effective factors preventing arbitrage?
A)search costs
B)transportation costs but not transaction costs
C)transaction costs but not tariffs
D)piracy

Question

Quizplus · Accepted Answer

Search costs can prevent arbitrage because it may take time and resources to find price discrepancies in different markets. Transportation costs, transaction costs, and tariffs can all increase the costs of arbitrage, but they do not necessarily prevent it from occurring. Piracy is not relevant to the concept of arbitrage.

Which of the Following Can Act as Effective Factors Preventing