describe one situation in which two people acting in theor own self interest can both gain from the transaction.
Sure! One situation in which two people acting in their own self-interest can both gain from a transaction is during a simple bartering exchange.
Imagine there are two individuals, Alex and Beth. Alex has a surplus of apples, while Beth has a surplus of oranges. Both Alex and Beth prefer to consume a variety of fruits rather than just apples or oranges.
In this situation, Alex and Beth can engage in a trade. Alex trades some of their apples with Beth for some of her oranges. By doing this, both Alex and Beth can satisfy their preferences for a variety of fruits without incurring any additional costs.
In this scenario, both Alex and Beth act in their self-interest by maximizing their personal satisfaction. Alex gets oranges, which they value more than the surplus apples they had, and Beth gets apples, which she values more than the surplus oranges.
By engaging in this trade, both individuals are able to improve their well-being by obtaining a more diverse range of fruits, even though they are acting in their own self-interest. This is considered a win-win outcome where both parties benefit from the transaction.