In Which of the Following Cases Is the Coase Theorem

question 234

Multiple Choice

In which of the following cases is the Coase theorem most likely to solve the externality?

• A)Richard is annoyed because his roommate smokes.
• B)Chemicals from farms in the Mississippi Valley are polluting the Gulf of Mexico.
• C)Car exhaust in a small town is making one of its residents ill.
• D)Industrialization around the world is causing acid rain.

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