Multiple Choice
Karen's cat causes Danny to sneeze. Karen values her cat's companionship at $300 per year. The cost to Danny of tissues and her allergy medication is $350 per year. Based on the Coase theorem,
A) Karen should pay Danny $400 so that she may keep her cat.
B) Karen should pay Danny $350 for tissues and allergy medication.
C) Danny should pay Karen $325 to give away her cat.
D) Danny should move.
Correct Answer:
Verified
Correct Answer:
Verified
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