Suppose That Maria Wants to Dine at a Fancy Restaurant,but

Multiple Choice

Suppose that Maria wants to dine at a fancy restaurant,but the only available table is in the smoking section.Maria dislikes the smell of cigarette smoke.She notices that only one person,John,is smoking in the smoking section.Maria values the absence of smoke at $25.John values the ability to smoke in the restaurant at $20.In order for Maria to pay John not to smoke,she will need to tip the waiter $10 to facilitate the transaction.Which of the following represents an efficient solution?

A) John continues to smoke because the cost to Maria to pay him not to smoke is between $30 and $35, which exceeds the benefit to her of no smoking ($25) .
B) Maria offers John between $20 and $25 not to smoke, and she pays the waiter $10.John accepts, and both parties are better off.
C) Maria offers John between $20 and $25 not to smoke, and she pays the waiter $10.John declines because he has a right to smoke in the smoking section.
D) Maria offers John $10 not to smoke, and she pays the waiter $10.John accepts, and both parties are better off.