The Coase Theorem is the proposition that private transactions are efficient if property rights exist, if only a ________ number of parties are involved, and if transactions costs are ________.
A) large; low
B) large; high
C) small; low
D) small; high

Question

Quizplus · Accepted Answer

The Coase Theorem suggests that private transactions will lead to efficient outcomes when property rights are well-defined, the number of parties involved is small, and transaction costs are low, allowing parties to negotiate without significant barriers.

The Coase Theorem Is the Proposition That Private Transactions Are