A Meditation Class Meets on the Second Floor of a Building;

question 52

Multiple Choice

A meditation class meets on the second floor of a building; the first floor is a dance academy. The loud music from the academy disturbs the meditation classes. The academy could be soundproofed for a cost of $6,000 or move at a cost of $9,000. The class cannot be soundproofed enough to overcome the music, but could be moved for $5,000. According to the Coase theorem, a socially optimal solution can be achieved if:​

• A)the government purchases the building.
• B)the dance academy is relocated.
• C)property rights to be noisy are granted to the nightclub.
• D)property rights to a quiet environment are granted to the meditation class.
• E)both the dance academy and the meditation class relocate.

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Definitions:

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Beaver pelts refers to the fur of beavers, which was highly sought after for the manufacture of hats and garments, especially in the 17th and 18th centuries, driving the North American fur trade.

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A group of Native American tribes and First Nations peoples primarily inhabiting the Great Plains of the United States and Canada.

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Relating to the people, language, or culture of France.

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