The law of one price states that if transaction costs are zero, the price of identical goods should not be identical across all regions O True O False
Added by Lynn F.
Close
Step 1
Step 1: The law of one price states that identical goods should have the same price in different markets if there are no transaction costs. Show more…
Show all steps
Your feedback will help us improve your experience
James Kiss and 51 other Microeconomics educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
If an identical product can be sold in two different markets, and no restrictions exist on the sale or transportation of product between markets, the product's price should be the same in both markets. This is known as: a. interest rate parity. b. equilibrium. c. the law of one price. d. relative purchasing power parity.
James K.
True or False: If a country is open to international trade, the domestic price can differ from the international price. LO38.3
Prabhat T.
In a perfectly-competitive market, no single firm can influence price; market price is solely determined by supply and demand. True False
Nick J.
Recommended Textbooks
Principles of Economics
Principles of Microeconomics for AP® Courses
Economics
Transcript
Watch the video solution with this free unlock.
EMAIL
PASSWORD