What Happens When Parties Who Are Bargaining to Eliminate an Externality

Multiple Choice

What happens when parties who are bargaining to eliminate an externality problem hold out for a better deal

A) Bargaining breaks down and the inefficient outcome persists.
B) The eventual outcome will maximize total well-being.
C) Transaction costs must be reduced as part of the bargain.
D) One party will gain more than the other party.