The Coase theorem applies to cases where _____.
A)transactions costs are high
B)transactions costs are obvious
C)transactions costs are zero
D)transactions costs are difficult to figure out

Question

Quizplus · Accepted Answer

The Coase theorem applies to cases where transactions costs are zero, meaning that there are no costs associated with the negotiation and enforcement of property rights. In such cases, parties can reach an efficient outcome without the need for government intervention, as they can negotiate and bargain with each other to reach a mutually beneficial agreement.

The Coase Theorem Applies to Cases Where _____