David sells his car, which he considers worthless, to Cameron for $200. Which of the following statements is true?
A) David and Cameron must have different preferences for the car.
B) This trade did not create value because Cameron is buying a car that David considers worthless.
C) Cameron is the only one made better off by the trade.
D) David is made better off by the trade, but Cameron is made worse off.

Question

Quizplus · Accepted Answer

In a voluntary trade, both parties must have different preferences or valuations for the item being exchanged. David values the car at less than $200, while Cameron values it at $200 or more, allowing the trade to occur.

David Sells His Car, Which He Considers Worthless, to Cameron