What might prevent landlord from reaching efficient outcome

Reference no: EM13245459

Ringo loves playing rock-n-roll music at high volume. Luciano loves opera but hates rock-n-roll. Unfortunately, they are next-door neighbors in an apartment building with paper-thin walls.

a. What is the externality here?

b. What command-and-control policy might the landlord impose? Could such a policy lead to an inefficient outcome?

c. Suppose the landlord lets the tenants do whatever they want. According to the Coase theorem, how might Ringo and Luciano reach an efficient outcome on their own? What might prevent them from reaching an efficient outcome?

Reference no: EM13245459

Questions Cloud

There is an arithmetic gradient income from years 6-10 with : There is an Arithmetic Gradient Income from years 6-10 with a Base Annuity of $500.00 and an Annual Gradient G of +$50.00

Calculate the reduction made by each firm : In a more typical situation, the government does not know the cost of pollution reduction for each firm. If the government decides to reach its overall goal by imposing uniform reductions on the firms, calculate the reduction made by each firm,

Explain the concentration of a solution of nitric acid : A chemist needs to determine the concentration of a solution of nitric acid, HNO_3. She puts 865 mL of the acid in a flask along with a few drops of indicator.

Calculate the value of the unknown resistance : A 5.0 ? resistor is connected in series with another resistor and a 5.0 V battery. The current in the circuit is 0.70 A. Calculate the value of the unknown resistance

What might prevent landlord from reaching efficient outcome : Suppose the landlord lets the tenants do whatever they want. According to the Coase theorem, how might Ringo and Luciano reach an efficient outcome on their own What might prevent them from reaching an efficient outcome

State lewis strucktures of each of the reactants : The product of this reaction, ozone, is a pollutant in the lower atmosphere. Ozone is an eye and lung irritant and also accelerates the weathering of rubber products. write Lewis strucktures of each of the reactants and products in the preceding r..

Find the greatest speed the mass reaches : A 2.40kg mass is pushed against a horizontal spring of force constant 26.0N/cm on a frictionless air table. The spring is attached to the tabletop, Find the greatest speed the mass reaches

Discuss whether you believe the country is on a good course : Using the information you gathered, discuss whether you believe the country is on a good course of economic growth and whether the macroeconomic policies are helping achieve this growth.

Define the equivalence point in a titration : If a solution contains 0.60 mol of OH^-, how many moles of H^+ would be required to reach the equivalence point in a titration?

User Account

All Pages