Curly and Moe Are Considering Living Alone or Being Roommates

question 30

Multiple Choice

Curly and Moe are considering living alone or being roommates and splitting the rent for the next twelve months. If they live alone, they each rent a one bedroom, one bath apartment for $500 per month, while if they are roommates, they can split a two bedroom, one bath apartment for $800 per month. The one difficulty they have is that Moe snores very loudly. Curly estimates the cost of poor sleep due to Moe's snoring at $150 per month. Moe could obtain a snore-eliminating device for $50 per month. The least costly solution to the externality present in this situation is for:

• A)Curly to endure Moe's snoring.
• B)both to live alone.
• C)Moe to eliminate his snoring.
• D)Moe to pay Curly for his discomfort.

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Definitions:

Revoke the Offer

The act of withdrawing a proposal that was previously presented to another party before it has been accepted.

Offeree

The party to whom an offer is made in a transaction, who has the power to accept the offer to form a binding contract.

Offeror

The party in a contract who makes an offer to enter into an agreement.

Assignee

An individual, entity, or other party that has been transferred a claim, benefit, or title from another, known as the assignor.