When voluntary trade takes place,
A)both parties can benefit from the transaction.
B)one party can benefit at the expense of the other.
C)neither party can benefit from trade.
D)both parties can benefit but only if the government regulates the transaction.

Question

Quizplus · Accepted Answer

Voluntary trade occurs when two parties willingly exchange goods or services without any external force. In this situation, both parties engage in the transaction because they believe that they will gain from it. Therefore, both parties can benefit from the trade, and neither is at the expense of the other. This mutual benefit is the basis of free market economics, where individuals are free to engage in voluntary trade without any external force regulating the transaction.

When Voluntary Trade Takes Place