The table given below shows the absolute tax amounts under five different tax policies for respective income levels.Table 19.2

-Whether exchange is between individuals, firms, or countries, voluntary trade occurs because:

Question

The table given below shows the absolute tax amounts under five different tax policies for respective income levels.Table 19.2
 
-Whether exchange is between individuals, firms, or countries, voluntary trade occurs because:

Quizplus · Accepted Answer

Voluntary trade occurs when both parties believe that they will be better off after the exchange. It is a mutually beneficial transaction where both parties gain. It is not just one party that benefits. Financial agents may facilitate the trade, but they do not cause it to happen. Voluntary trade can create employment opportunities, but this is not the primary reason for why it occurs. Government mandates are not necessary for voluntary trade to happen.

The Table Given Below Shows the Absolute Tax Amounts Under