_____ suggests that private individuals are able to negotiate an efficient solution to the problem of external costs or benefits in the presence of clearly defined property rights and low transaction costs.
A) The availability of a government subsidy
B) The Coase theorem
C) Economic efficiency
D) Cap-and-trade

Question

Quizplus · Accepted Answer

The Coase theorem posits that if property rights are well-defined and transaction costs are low, parties can negotiate privately to resolve externalities, leading to an efficient allocation of resources.

_____ Suggests That Private Individuals Are Able to Negotiate an Efficient