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Coase Theorem: Assume two people exist in society during the COVID-19 pandemic. Person A refuses to wear a mask and is healthy without much risk
Coase Theorem: Assume two people exist in society during the COVID-19 pandemic. Person "A" refuses to wear a mask and is healthy without much risk of death if COVID-19 is contracted. Person "B" always wears surgical masks in indoor places and is immunocompromised and at greater risk of death or harm if COVID-19 is contracted. Assume an indoor gathering where masks are required. Person "A" values not wearing a surgical mask at $20. Person "B" values everyone wearing a surgical mask at $800. Assume transactions costs are $0. What is the socially optimal outcome? Group of answer choices Everyone wears a mask no socially optimal outcome exists Person "A" is allowed to not wear a mask
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