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Question

The Coase theorem suggests that private parties

a. will never be able to negotiate to correct a negative externality.

b. can always negotiate to correct a negative externality.

c. can negotiate to correct a negative externality if there are no barriers to negotiation.

d. can negotiate to correct a negative externality if the government passes a law allowing them to do so.

e. can never negotiate to correct a negative externality if there are more than two parties involved.

Answer

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