Which of the following statements are TRUE about the Coase Theorem? 1. The firm would reduce production if the compensation offered was greater than the profit foregone. 2. Society would be happy to offer any compensation less than the damage caused by the pollution. 3. The theorem considers the distribution effects of the assignment of property rights. 4. The firm would reduce production if the compensation offered was greater than the profit foregone 5. Bargaining leads to the optimal quantity of output being produced without any need for government act O 1,3,4,5 O 1,2,4,5 O 2,3,4,5 O 1, 2,3,4
Which of the following statements are TRUE about the Coase Theorem? 1. The firm would reduce production if the compensation offered was greater than the profit foregone. 2. Society would be happy to offer any compensation less than the damage caused by the pollution. 3. The theorem considers the distribution effects of the assignment of property rights. 4. The firm would reduce production if the compensation offered was greater than the profit foregone 5. Bargaining leads to the optimal quantity of output being produced without any need for government act O 1,3,4,5 O 1,2,4,5 O 2,3,4,5 O 1, 2,3,4
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Q45
Transcribed Image Text:Question 45
Which of the following statements are TRUE about the Coase Theorem?
1. The firm would reduce production if the compensation offered was greater than the profit foregone.
2. Society would be happy to offer any compensation less than the damage caused by the pollution.
3. The theorem considers the distribution effects of the assignment of property rights.
4. The firm would reduce production if the compensation offered was greater than the profit foregone
5. Bargaining leads to the optimal quantity of output being produced without any need for government actio
O 1,3,4,5
O 1,2,4,5
O 2,3,4,5
O 1,2,3,4
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