According to the Coase approach,to achieve socially optimal outcome,two sides must bargain.The bargaining might not be successful because

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The Coase approach assumes that transaction costs are the primary obstacle to a successful negotiation between two parties. However, if firms engage in strategic bargaining, where they deliberately misrepresent their costs or benefits in order to gain an advantage in the negotiation, the bargaining process can fail to result in a socially optimal outcome. Therefore, option B is the correct choice. Option A is incorrect because transaction costs are central to the Coase approach. Option C is also incorrect because perfect information is not necessary for bargaining to occur, although it can improve the efficiency of the bargaining process. Option D is incorrect because option B is a valid reason why the bargaining might not be successful.

According to the Coase Approach,to Achieve Socially Optimal Outcome,two Sides