According to the Coase theorem, private parties can solve the problem of externalities if a. the...

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According to the Coase theorem, private parties can solve the problem of externalities if a. the...

According to the Coase theorem, private parties can solve the problem of externalities if

a. the cost of bargaining is small

b. the initial distribution of legal rights favors the person being adversely affected by the externality

c. the number of parties involved is sufficiently large

d. all of the above are correct

business economics

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Answer 1

Answer #1

As per the Coase theorem, private parties can solve the problem of externalities if-

- The cost of bargaining is small

option(A)

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Answer 2

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