D Question 9 1 pts Imagine a smoker has the right to smoke inside a bus where Jo

Question

D Question 9 1 pts Imagine a smoker has the right to smoke inside a bus where John is, and John hates second-hand smoke. John can easily speak with the smoker about the issue. According to the Coase Theorem, what outcome is most likely? O John can potentially bargain with the smoker to pay the smoker to not smoke. O John will definitely experience second-hand smoke because the smoker was given property rights O The smoker must stop smoking because John wants it and there are low transactions costs o John will have to ask the police to intervene on his behalf

Explanation / Answer

According to the Coase Theorem, the most likely outcome is that the smoker must stop smocking because John wants it and there are low transaction costs. So option C is a correct option.

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