Questions: When two people engage in voluntary trade, both will necessarily lose. both will expect to be made better off. one will necessarily lose. each will expect to lose.

The answer is: both will expect to be made better off.

Explanation for each option:

1. Both will necessarily lose: This is incorrect. In voluntary trade, both parties engage in the transaction because they believe they will benefit from it. If both parties expected to lose, they would not voluntarily engage in the trade.

2. Both will expect to be made better off: This is correct. Voluntary trade is based on the principle that both parties anticipate a benefit from the exchange. Each party values what they are receiving more than what they are giving up, leading to mutual benefit.

3. One will necessarily lose: This is incorrect. Voluntary trade is not a zero-sum game where one party's gain is another party's loss. Instead, it is a positive-sum game where both parties can benefit.

4. Each will expect to lose: This is incorrect. If both parties expected to lose from the trade, they would not engage in it voluntarily. The expectation of mutual benefit is what drives voluntary trade.

In summary, voluntary trade occurs because both parties believe they will be better off after the exchange.