The Coase Theorem Suggests That Private Markets May Not Be

question 114

Multiple Choice

The Coase theorem suggests that private markets may not be able to solve the problem of externalities

• A)if the government does not become involved in the process.
• B)when the number of interested parties is large and bargaining costs are high.
• C)if the firm in the market is a monopoly.
• D)if some people benefit from the externality.

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Definitions:

Ego

A component of Sigmund Freud's psychoanalytic theory, representing the realistic part of the psyche that mediates between desires and moral constraints.

Self

Pertaining to the individual person, often in reference to one's own thoughts, feelings, or actions.

Mind

The element of a person that enables them to be aware of the world and their experiences, to think, and to feel; the faculty of consciousness and thought.

Personality

The combination of characteristics or qualities that form an individual's distinctive character.