According to the Coase Theorem, Private Parties Can Solve the Problem

question 143

Multiple Choice

According to the Coase theorem, private parties can solve the problem of externalities if

• A)the cost of bargaining is small.
• B)property rights aren't clearly defined.
• C)the number of parties involved is sufficiently large.
• D)the initial distribution of legal rights favors the person being adversely affected by the externality.

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