A Copper Ore Refiner Pollutes the Water Upstream from a Brewery

question 303

Multiple Choice

A copper ore refiner pollutes the water upstream from a brewery. These are the only two parties involved. The transactions costs of reaching an agreement between the refinery and the brewery are low. The amount of water pollution will be at the efficient level

• A) only when the property right to the stream is assigned to the ore refinery.
• B) only when the property right to the stream is assigned to the brewery.
• C) when the property right to the stream is assigned to either the refinery or to the brewery.
• D) when no one has clear property rights.

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Definitions:

Distinctiveness

The quality or condition of being unique and different from other entities in identifiable ways.

Consistency

The quality of always acting or behaving in the same way, exhibiting uniformity in essential traits.

Consensus

A general agreement or the practice of developing such an agreement among the members of a group or community.

Frequency

The rate at which an event or occurrence happens within a given period of time.