When Property Rights Are Assigned and Transactions Costs Are Low

question 95

Multiple Choice

When property rights are assigned and transactions costs are low,

• A) all costs and benefits are taken into account by the transacting parties so the transaction is efficient.
• B) externalities will result in market failure.
• C) the marginal social benefit curve shifts leftward and the marginal social cost curve does not shift.
• D) the marginal social cost curve shifts rightward and the marginal social benefit curve does not shift.
• E) the marginal social cost curve shifts rightward and the marginal social benefit curve also shifts rightward.

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