When There Are Significant Costs Involved with Coordinating a Private

question 19

Multiple Choice

When there are significant costs involved with coordinating a private solution to an externality:

• A)a leader will likely be elected to organize the coordination.
• B)these costs can act as a motivating factor to solve the externality problem expediently.
• C)a private solution likely will not occur.
• D)None of these are true.

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Definitions:

Intrastate Offering Exemption

A legal exemption allowing securities to be sold within a single state without needing to register with the federal Securities and Exchange Commission.

Rule 147

A regulation under the U.S. Securities Act of 1933, facilitating companies to raise funds from investors within their state without registering the offer with the SEC.

Intrastate Resale

The sale of goods or services within the same state, not crossing state boundaries.

Section 404

A section of the Sarbanes-Oxley Act in the United States that requires management and auditors to report on the adequacy of a company's internal control on financial reporting.