If Jamal Successfully and Completely Internalizes a Negative Externality, It

question 173

Multiple Choice

If Jamal successfully and completely internalizes a negative externality, it follows that

• A)transaction costs are zero.
• B)his marginal private costs are equal to marginal social costs.
• C)information is asymmetric.
• D)information is symmetric.
• E)none of the above

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Definitions:

Parol Evidence Rule

The parol evidence rule is a legal doctrine that prevents parties to a written contract from presenting external evidence that contradicts or adds to the written terms of the contract.

UCC

Stands for Uniform Commercial Code, a comprehensive set of laws governing all commercial transactions in the United States.

Statute of Frauds

A rule of law mandating that specific contract categories must be documented and signed by the involved parties to have legal validity.

Writing Requirement

The legal principle that certain contracts or agreements must be documented in written form to be legally binding.