The lowest price Jacob will accept from Harold for a bushel of corn produced in his farm is $5.The transaction will go through if:
A)Harold's valuation is less than Jacob's.
B)Harold's valuation is greater than $5.
C)Jacob's opportunity cost is greater than Harold's.
D)Jacob's opportunity cost is equal to Harold's.

Question

Quizplus · Accepted Answer

The transaction will go through if Harold's valuation is greater than $5, as this means he is willing to pay more than Jacob's minimum price. If Harold's valuation is less than Jacob's, they will not reach an agreement. Opportunity costs are not directly relevant to this transaction.

The Lowest Price Jacob Will Accept from Harold for a Bushel