Dick has a dog (Spot) that likes to bark at night. Jane, who ...

[nenivikky]

Dick has a dog (Spot) that likes to bark at night. Jane, who lives next door to Dick, must be at work every morning by six o'clock. Suppose that there is no noise ordinance that requires Dick to keep his dog quiet.
 
  Is there any Coase solution to this problem? Explain.

Question 2

Suppose that you are an analyst working for a venture capital firm. An individual contacts you about backing his brand new Internet company. What information would you want before making this decision?
 
  What will be an ideal response?

[lcapri7]

Answer to Question 1

Since Jane has no right to expect the dog to remain quiet (and Dick has a right to have a dog), Jane could pay Dick to either get rid of the dog or to keep the dog indoors during the night.

Answer to Question 2

You would want information that would allow you to calculate an expected rate of return on your investment. Therefore, you would need information on projected costs and revenues for the firm.

[nenivikky]

Gracias!

[ricroger]

TYSM