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Questions
Single choice
Matilda sells her iPhone, which she considers worthless, to Gabriel for $200. Which of the following statements is TRUE?
Options
A.This trade created value because Gabriel is buying the iPhone for more than Matilda thinks it is worth.
B.Matilda is the only one made better off by the trade.
C.Matilda and Gabriel must have the same preferences for the iPhone.
D.Matilda is made better off by the trade, but Gabriel is made worse off by the trade.
View Explanation
Standard Answer
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Approach Analysis
First, let’s restate the scenario and each option to ensure clarity about what is being evaluated.
- Scenario: Matilda sells her iPhone, which she considers worthless, to Gabriel for $200. The question asks which statement about the trade is TRUE.
- Option 1: This trade created value because Gabriel is buying the iPhone for more than Matilda thinks it is worth.
- Option 2: Matilda is the only one made better off by the trade.
- Option 3: Matilda and Gabriel must have the same preferences for the iPhone.
- Option 4: Matilda is made better off by the trade, but Gabriel is made worse of......Login to view full explanationLog in for full answers
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