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Author Question: The Coase TheoremLarue is learning to play the piano, but his roommate needs a quiet space to write ... (Read 84 times)

heyheyhey

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on: Nov 23, 2022
The Coase Theorem

Larue is learning to play the piano, but his roommate needs a quiet space to write his novel. Larue and his roommate are willing to split the difference between the willingness to pay for noise reduction and the willingness to accept it. The table shows the marginal benefit to Larue from playing for one to five hours, as well as the marginal external cost incurred by his roommate.
HourMarginal BenefitMarginal External Cost
170​55​
264​55​
358​55​
452​55​
534​55​
If Larue has the property rights to make as much noise as he likes, how many hours will he practice? Who gets how much money?
Suppose the roommate has the property rights to a quiet house. How many hours will Larue practice? Who gets how much money?
◦ 3 hours, Larue gets $110, 3 hours, Roommate gets $165
◦ 5 hours, Larue gets $0, 3 hours, Roommate gets $165
◦ 5 hours, Larue gets $0, 0 hours, Roommate gets $0
◦ 3 hours, Larue gets $110, 0 hours, Roommate gets $0
Macroeconomics ¦ Acemoglu, Laibson, List ¦ 3rd Edition
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Marked as best answer by heyheyhey on Nov 23, 2022

khammond77

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Reply #1 on: Nov 23, 2022
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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heyheyhey

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Reply 2 on: Nov 23, 2022
Wow, this really help

isabelt_18

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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