The Coase Theorem says that which of the following is necessary to lead to an efficient use of resources?
A) presence of transaction costs
B) existence of property rights
C) government intervention
D) All of the above answers are correct.

Question

Quizplus · Accepted Answer

The Coase Theorem states that as long as property rights are clearly defined and there are no transaction costs, private parties will negotiate to an efficient use of resources without the need for government intervention. Therefore, the only necessary condition for an efficient use of resources is the existence of property rights. The presence of transaction costs and government intervention can affect the efficiency of negotiations, but they are not necessary for an efficient outcome according to the Coase Theorem.

The Coase Theorem Says That Which of the Following Is