Final answer:
Exchange is indeed the trade of things of value between buyers and sellers so that each benefits, which makes the statement true. Market exchanges can also impact third parties through externalities, and the overall social well-being must be considered. International trade serves as an example of mutually beneficial exchanges.
Step-by-step explanation:
The statement that exchange is the trade of things of value between buyers and sellers so that each benefits is true. In a voluntary exchange, both parties agree to the trade because they each expect to gain from it. Private markets like the cell phone industry highlight the efficiency of bringing together buyers and sellers to facilitate these beneficial exchanges.
However, it's also important to consider the impact of an exchange on external parties. In some cases, a voluntary exchange can affect third parties, who are neither the buyer nor the seller. This phenomenon is known as an externality, and it can have positive or negative consequences that are not reflected in the market prices of the goods or services exchanged. Social well-being may be compromised in favor of individual gains when market exchanges are driven purely by self-interest and greed.
An example of beneficial exchanges is international trade. As illustrated in an example where the U.S. exports refrigerators to Mexico in exchange for shoes, both countries benefit by being able to consume more goods than they would without trade.