The Idea That Resource Allocation Can Remain Efficient,even in the Presence

question 33

Multiple Choice

The idea that resource allocation can remain efficient,even in the presence of externalities,as long as property rights are clearly assigned and transaction costs are low is referred to as the:

• A)law of demand.
• B)Black/Schloes formula.
• C)Coase Theorem.
• D)law of diminishing returns.

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Definitions:

Business Trust

A legal entity formed under trust law to pursue business activities, offering participants flexibility in management and investment.

Assets

Economic resources or owned items of value that an individual, company, or organization possesses.

Profits

The financial gain obtained after subtracting expenses from revenue in a business operation.

Syndicate

A group of individuals or organizations combined to undertake some specific business venture or share the risk in investments.