The Coase Theorem Will Apply Only When

question 69

Multiple Choice

The Coase theorem will apply only when

• A)an individual who is not affected by the externality can negotiate a settlement between the parties imposing the externality and the parties that are harmed by the externality.
• B)transactions cost are low.
• C)the market is perfectly competitive.
• D)the courts can be used to determine the amount of compensation that must be made to the damaged party.
• E)the amount of compensation that must be made to the damaged party is small.

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Definitions:

External Proposals

proposals submitted from outside an organization, typically by vendors or partners, suggesting a project or service to address the organization’s needs.

Sales Proposals

Documents or presentations that outline an offer for a product or service, including details about benefits, pricing, and terms, intended to persuade potential customers.

Internal Proposals

These are suggestions or plans submitted within an organization aiming to initiate change or improvement.

Investment Proposals

Documents or presentations that outline the details and potential benefits of investing in a particular project or venture.