The Idea That Even in the Presence of Externalities an Economy

question 135

Multiple Choice

The idea that even in the presence of externalities an economy can reach an efficient solution as long as transaction costs of making a deal are low is known as:

• A)a Pigouvian tax.
• B)a network externality.
• C)a technology spillover.
• D)the Coase theorem.

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Definitions:

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