Mutually beneficial trade is possible because of differing marginal utilities.

Question

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Mutually beneficial trade occurs when each party values what the other party has more than what they are giving up. This is possible because individuals have different marginal utilities for goods and services, meaning they assign different levels of value and importance to them. Therefore, trade allows each party to obtain goods/services with higher marginal utility than what they are giving up, resulting in a mutually beneficial outcome.

Mutually Beneficial Trade Is Possible Because of Differing Marginal Utilities