Suppose a seller's opportunity cost matches a buyer's valuation of the product.Assuming a two-person economy, which of the following statements will be true?

Question

Quizplus · Accepted Answer

If the seller's opportunity cost matches the buyer's valuation, then both parties are indifferent towards the exchange. This means that the exchange will not create any additional economic value beyond what already exists. Therefore, option B is the correct answer. Option A is incorrect because the transaction will not benefit the buyer more than the seller, as both parties are equal in their valuation of the good. Option C is incorrect because it assumes that there is a loss associated with the transaction when there is none. Option D is incorrect because it assumes that the seller will be worse off than the buyer, when in reality, both parties are equal in their valuation.

Suppose a Seller's Opportunity Cost Matches a Buyer's Valuation of the Product.Assuming