The Major Implication of the Coase Theorem Is That

question 86

Multiple Choice

The major implication of the Coase theorem is that

• A) government regulation is necessary to solve externalities.
• B) competitive pressures will eliminate externalities.
• C) resolving externalities is more costly than allowing them.
• D) individuals can solve many externalities if they can buy and sell the right to commit the externality.
• E) governmental solutions to externalities can only fail.

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Definitions:

Torque Converter

A fluid coupling consisting an impeller, stator, and turbine used to transmit driving torque from an engine to transmission; it provides continuously variable drive ratios and can multiply torque.

Countershafts

Secondary shafts in a gearbox that carry gears of various sizes, affecting the gear ratio between the input and output shafts.

Allison TC10

A model of automatic transmission for commercial vehicles, offering fuel efficiency and durability, designed by Allison Transmission.

Input Torque

The amount of turning force applied to the input shaft of a mechanism or system, such as a gearbox, influencing its output torque and overall performance.