Overview
Trust plays a vital role in economic transactions, acting as a foundation for successful exchanges. It allows parties to engage confidently, reducing the fear of exploitation and encouraging cooperation. A strong reputation enhances trust, influencing consumer behavior and market dynamics. Additiona...
Key Terms
Example: I trust my friend to pay me back.
Example: A business with a good reputation attracts more customers.
Example: Shipping fees are a type of transaction cost.
Example: Investing in stocks carries a risk of losing money.
Example: E-commerce is a significant part of the digital economy.
Example: In an efficient market, stock prices adjust quickly to news.
Related Topics
Key Concepts
trustworthinessreputationrisktransaction costs