Lecture 6: Transaction Cost Theory COPY Flashcards
1
Q
Describe transaction cost.
A
It is the cost incurred in making any economic trade.
These costs include expenses such as
- brokerage fees,
- commissions,
- taxes,
- other charges
associated with economic trades.
Transaction costs are not related to the production of goods or services but rather to the exchange or trade of these items in the economic market.
