The Coase Theorem States That

question 183

Multiple Choice

The Coase theorem states that

• A)government intervention is always needed if externalities are present.
• B)assigning property rights is the only thing the government should do in a market economy.
• C)if transactions costs are low, private bargaining will result in an efficient solution to the problem of externalities.
• D)a free-market equilibrium is the best solution to address externalities.

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