According to the Coase Theorem, Which of the Following Conditions

question 168

Multiple Choice

According to the Coase theorem, which of the following conditions must hold, in order for private solutions to externalities to be possible?
(i) bargaining costs are small
(ii) property ownership/rights cannot be defined
(iii) the number of parties involved is large

• A)(i), (ii) and (iii)
• B)conditions (i) and (ii) only
• C)condition (i) only
• D)conditions (i) and (iii) only

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Definitions:

Attribution

The process by which individuals explain the causes of behavior and events, often as either internal dispositions or external situations.

Cognitive Dissonance

The psychological discomfort experienced when holding two or more conflicting beliefs, ideas, or values.

Fundamental Attribution Error

A cognitive bias that causes people to overemphasize personal characteristics and ignore situational factors in judging others' behavior.

Situational Attribution

The process of attributing a person's behavior to external or situational factors.