The Coase solution to the problem of externalities
a. applies in every situation where externalities are present
b. only applies to activities that generate positive externalities
c. only works under perfect competition
d. only works when bargaining costs are low
e. can lead to an increase in the common pool problem
D
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Efficiency-wage theory suggests that paying
a. low wages might be profitable because they raise the efficiency of a firm's workers. b. low wages might be profitable because they lower the efficiency of a firm's workers. c. high wages might be profitable because they raise the efficiency of a firm's workers. d. high wages might be profitable because they lower the efficiency of a firm's workers.
In the short run, monopolistically competitive firms:
A. can earn positive economic profits by acting like a monopolist. B. will earn zero economic profits by acting like a monopolist. C. can earn positive economic profits by acting like a perfectly competitive firm. D. will earn zero economic profits by acting like a perfectly competitive firm.