Question

externalities can be internalized through voluntary agreements as long as group of answer choices transaction costs are low relative to expected benefits. transaction costs are high relative to expected benefits. the agreement is a short-run agreement. the agreement is a long-run agreement.

Answer 1

Externalities can be internalized through voluntary agreements as long as transaction costs are low relative to expected benefits.

Step-by-step explanation:

Externalities can be internalized through voluntary agreements as long as transaction costs are low relative to expected benefits. When transaction costs are high relative to expected benefits, it becomes more difficult to reach agreements that internalize externalities. Voluntary agreements can be either short-run or long-run agreements, depending on the specific context and duration of the agreement.