The Coase Theorem Implies That the Initial Allocation of Property

Multiple Choice

The Coase theorem implies that the initial allocation of property rights:

A) determines all aspects of the final outcome of the negotiated agreement.
B) does not determine which person will be entitled to engage in the externality generating activity, but does determine which person will receive compensation.
C) determines which person will be entitled to engage in the externality generating activity, but does not affect which person will receive compensation.
D) must be assigned to the person with the greatest costs.