Voluntary Exchange
Definition
Voluntary exchange refers to the act of individuals or entities willingly trading goods or services with each other without coercion or force. Both parties involved in the exchange must perceive it as mutually beneficial for it to occur voluntarily.
Related terms
Barter System: A system where goods or services are directly exchanged for other goods or services without using money.
Market Economy: An economic system based on voluntary exchanges between buyers (consumers) and sellers (producers).
Specialization: When individuals or firms focus on producing specific goods or providing certain services based on their comparative advantage.
"Voluntary Exchange" appears in:
Subjects (1)
AP Microeconomics
Study guides (1)
AP Macroeconomics - 2.1 Circular Flow and GDP
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About Us
About Fiveable
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Privacy Policy
CCPA Privacy Policy
Resources
Cram Mode
AP Score Calculators
Study Guides
Practice Quizzes
Glossary
Cram Events
Merch Shop
Crisis Text Line
Help Center
© 2024 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.