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Which of the Following Will Lead to an Efficient Private

Question 39

Multiple Choice

Which of the following will lead to an efficient private solution if negative externalities are present in a market?


A) The government paying a subsidy to the parties involved in generating externalities
B) The party creating the externality having legal property rights
C) The party suffering from the externality having legal property rights
D) The parties involved negotiating with each other and reaching an agreement

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