According to the Coase theorem,a. private actors can reach agreement to solve theproblem of externalities without the government.b. corrective subsidies are the best policy to solvethe problem of positive externalities.c. negative externalities are a problem for societybut positive externalities are not.d. when two private actors amicably solve theproblem of externalities, they shift the problem toa third party

Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter11: Public Goods And Common Resources
Section: Chapter Questions
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According to the Coase theorem,
a. private actors can reach agreement to solve the
problem of externalities without the government.
b. corrective subsidies are the best policy to solve
the problem of positive externalities.
c. negative externalities are a problem for society
but positive externalities are not.
d. when two private actors amicably solve the
problem of externalities, they shift the problem to
a third party

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