Question

(consider this) suppose that a large tree on betty's property is blocking chuck's view of the lake below. betty accepts chuck's offer to pay betty $100 for the right to cut down the tree. this situation describes: the coase theorem. the optimal allocation of a public good. nonrivalry and nonexcludability. a market for externality rights.

Answer 1

The correct answer is the Coase theorem

Suppose that a large tree on Betty's property is blocking Chuck's view of the lake below. Betty accepts Chuck's offer to pay Betty $100 for the right to cut down the tree. This situation describes the Coase theorem.