The Result That,under Certain Circumstances,no Government Action Is Needed to Control

question 39

Multiple Choice

The result that,under certain circumstances,no government action is needed to control an externality because it can be eliminated by bargaining between the affected parties is called

• A) a Nash Equilibrium.
• B) Coase Theorem.
• C) Bargaining Theorem.
• D) English Bargaining.

---

Definitions:

Expense Recognition Principle

An accounting principle that dictates expenses should be recognized in the same period as the revenues they helped to generate, ensuring financial statements accurately reflect business activities.

Asset Valuation Principle

A principle in finance that entails estimating the current worth of an entity's assets, considering market value, use value, and other factors.

Historical Cost Principle

A fundamental accounting rule stating that assets must be logged and presented at the cost they were originally bought for.

Going Concern Principle

An accounting assumption that a company will continue operating and not go bankrupt or be liquidated in the foreseeable future.