The Coase Theorem States That

question 162

Multiple Choice

The Coase theorem states that

• A)positive externalities are directly related to the weather-the better the weather, the more positive externalities.
• B)in the case of trivial or zero transaction costs, negative externalities are more likely to appear.
• C)when transaction costs are high, positive externalities will be minimized.
• D)in the case of trivial or zero transaction costs, the property rights assignment does not matter to the resource-allocative outcome.

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Definitions:

Cost Reconciliation Report

A financial report used to compare and reconcile the estimated costs to the actual costs incurred for a specific project or during a particular period.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available for sale.

Percentage Completion

An accounting method used to recognize revenue and expenses in long-term projects, based on the project's degree of completion.

Weighted-Average Process Costing System

A costing methodology that averages the costs of different production batches over a period to calculate the cost per unit.