Question

There is much open access to the Hudson River, and GE in the past poured dangerous pollutants (PCV's) into the River. Which of the following options describe both the transaction and free rider costs that were a barrier to the community's prevention of the problem.

		transaction cost: it would have cost money to know what GE was putting in the water. free rider: many people would not contribute to the effort, depending on others to do the work.
		transaction cost: it costs GE money to engage in the transaction of waste elimination and they resist incurring the costs. free rider:a document attached to legal transactions without a fee
		transaction cost: The cost to people of transactions to find substitute products if the GE facility were to be shut down. free rider: The people who do not expect others to investigate GE
		none of the above

Answer 1

The answer is:

Transaction Cost: it costs GE money to engage in the transaction of waste elimination and they resist incurring the costs. Free Rider: a document attached to legal transactions without a fee.