Question

Valerie has opened a new startup company in web design. Within the first month of business, the startup agrees to maintain an accounting firm’s website in exchange for someone doing their tax returns.
Which of the following principles of economic interaction best describes this scenario?
a. All costs are opportunity costs.b. When markets do not achieve efficiency, government intervention can improve overall welfare.c. Markets allocate goods effectively.d. There are gains from trade.

Answer 1

Answer:

The correct answer is d. There are gains from trade.

Explanation:

In this situation a profit is presented for both companies, because the described relationship represents the main activity that each one performs, but in turn, details the need of each one for a service that generates value, since a company, As a capital company, it is a machinery whose purpose is the generation of value: the investment of economic resources, contributed by the ownership of the company, allows generating new wealth (value), in the most general case, thanks to the work of its employees. The first reason for the investment of resources is that additional generation of wealth that is expected to be achieved. Under these conditions, it seems clear that the objective of any manager of a company should be the generation of value for the shareholder.