​Sophia Sits Behind Gabriel on an Airplane

question 25

Multiple Choice

​Sophia sits behind Gabriel on an airplane. Gabriel owns the right to recline his seat and values this right at $10. Sophia values a non-reclined seat in front of her at $40. Assuming no transaction costs, which of the following represents an efficient solution?

• A)​Sophia offers Gabriel between $10 and $40 to not recline his seat. Gabriel accepts, and both parties are better off.
• B)​Sophia offers Gabriel between $0 and $10 to not recline his seat. Gabriel accepts, and Sophia is better off.
• C)​Sophia offers Gabriel between $10 and $40 to not recline his seat. Gabriel declines because he has the right to recline his seat.
• D)​Gabriel offers Sophia between $10 and $40 to recline his seat. Sophia accepts, and both parties are better off.

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Definitions:

Self-Efficacy

An individual's belief in their own ability to succeed in specific situations or accomplish a task.

Active Participation

Refers to the engagement and involvement of individuals in activities or processes that affect their lives or outcomes.

Teaching Process

A systematic series of actions, strategies, and methods applied by teachers to facilitate learning.

Learning Needs

The gaps in knowledge that must be addressed for an individual to achieve a desired level of understanding or competence.