The Coase Theorem States That If Transaction Costs Are Low

question 35

Multiple Choice

The Coase theorem states that if transaction costs are low, the number of parties is small, and property rights are well established,

• A) private transactions are efficient.
• B) the government must intervene to eliminate any externalities in the market.
• C) there will be no pollution.
• D) Both answers B and C are correct.

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Definitions:

Reckless Indifference

denotes a disregard or lack of concern for the consequences of one's actions, particularly where such actions pose a risk to others.

Tangible Employment Action

A significant change in employment status or benefits, such as occurs when an employee is fired, refused a promotion, or reassigned to a lesser position.

Supervisor's Sexual Harassment

Unwanted sexual advances, requests for sexual favors, or other verbal or physical harassment of a sexual nature made by a supervisor towards a subordinate.

Liable

Legally responsible or obligated to make amends for a loss or damage.